Chart of the Day - Friday, February 18th, 2022

Today’s Chart of the Day was shared by Gina Martin Adams of Bloomberg (@GinaMartinAdams). It's a chart of the S&P 500 over the past seven years. Breadth has been deteriorating for nearly a year now, but it's reached a crucial level. As of today's close, only 43% of S&P 500 stocks are trading above their 200-day moving averages. In other words, over half of the stocks within the S&P 500 are in confirmed downtrends (as measured by the 200-day moving. average). Gina points out that 50% has been a key threshold for this breadth indicator over the years, noting "Breadth has rarely broken 50% for more than a few days without a significant correction." Caution remains warranted so long as breadth is below that key 50% threshold.