MARKET CALL: Death Cross Versus Zweig Breadth Thrust

Only a few days ago, some stock-market-chart watchers warned that Trump's Tariff Turmoil (TTT) set up a bearish Death Cross formation in the S&P 500 and Nasdaq 100. That occurs when the 50-day moving average crosses below the 200-day moving average (chart). The formation historically has signaled declines ahead, but not all Death Crosses have preceded major downturns.

Now some market watchers are seeing a bullish Zweig Breadth Thrust, a technical analysis tool developed by Martin Zweig. It measures market breadth by analyzing the percentage of advancing stocks relative to the total number of stocks (advancing and declining) over a 10-day period. A "thrust" occurs when this indicator rises rapidly from below 40% to above 61.5% within 10 days, suggesting a potential market rally. A similar version of this concept is the percent of S&P 500 companies with positive y/y percent changes (chart). It's shown lots of thrust since April 8, i.e., the day before Liberation Day was postponed for 90 days by President Donald Trump.