We had seemingly moved past other issues, but renewed geopolitical tensions have led to a sudden increase in price volatility. Since the only constant is change, a dynamic landscape will continue to produce price volatility, up and down.  

The Day Hagan Catastrophic Stop model held steady at 68.18%, the same level as last week. The model indicates that investors should maintain their benchmark equity exposure.

The Catastrophic Stop model is unchanged from last week at 77.27%. The model indicates that investors should maintain their benchmark equity exposure.

Many domestic equity market indices and the NYSE all issues Advance-Decline Line (A/D Line) had been moving sideways. That is no longer the case as the lateral pattern resolved higher—bullish and supportive of a stair-step move higher.

After such a big rebound, don’t be surprised if the price pattern—a period of digestion, short-lived rallies, and short-lived declines (versus sustained buying and selling)—continues, followed by another, potentially strong, rally.

The Catastrophic Stop model is unchanged from last week at 77.27%. The model indicates that investors should maintain their benchmark equity exposure.

Equity markets don’t usually enjoy drama, especially now with all the underlying crosscurrents and headline risk. Case in point: Last week’s sell-off and yesterday’s rally. Respect the recent bullish tape action but be aware of ongoing crosscurrents and headline risks.

The Catastrophic Stop model is unchanged from last week at 77.27%. The model recommends that investors maintain their equity benchmark exposure.

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The Catastrophic Stop model increased to 77.27% from 72.73% last week. The model recommends that investors maintain their equity benchmark exposure.

S&P 500, NDX, and DJIA Advance-Decline Lines hit new highs (bullish) before Monday’s moonshot.  The NYSE A/D Line (all issues only) fractionally did so yesterday. Equities remain emotionally driven and highly subject to news. Sentiment isn’t 100% complacent but is getting close.

The Catastrophic Stop model increased to 72.73% from 70.83% last week. The model recommends that investors maintain their equity benchmark exposure.

The Catastrophic Stop model increased to 70.83% from 60.0% last week. The model recommends that investors maintain their equity benchmark exposure.

Despite a headline-driven environment, the fear factor took a breather and the bulls took charge. Now what? Consolidation? Pullback? More upside? With four recent breadth thrusts, I’m happy with any of these. Regardless, with overhead resistance, more work must be done.

The Catastrophic Stop Model increased to 60.0%, up from 47.9% last week. The model recommends that investors maintain their benchmark exposure.

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The Catastrophic Stop model level remains at 47.9%, the same as last week. The model recommends that investors maintain their benchmark exposure.

Following one of the biggest short squeezes in recent memory (4.9.25) and within the confines of the S&P 500’s pattern of lower price peaks and lower price troughs, I expect upside and downside volatility to continue despite the recent tariff news. What are we now watching?

The Catastrophic Stop model increased to 47.9% from 40.7% last week due to one of the model’s Trend Factors shifting positive. Supporting the Trend Factor are measures tracking Oversold Mean Reversion (showing that the markets reached extreme oversold levels and selling exhaustion), Sentiment (pessimism reached extreme levels similar to 2002, 2009, and 2020).

The Catastrophic Stop model level is 40.7%, down from 51.4% last week and on the cusp of a sell signal. The model’s decline was due to volume-adjusted demand falling below volume-adjusted supply for the first time since September 2023. On balance, the model’s technical indicators are bearish, while the external indicators are low-neutral.