Market Gains Driven by Few Large Caps
Breadth / Stock Participation: Signs of weakness, as less than 50% of $NASDAQ 100(NDX)$ 's stocks are trading above their 20 and 50-day moving averages, even as the index hits all-time highs.
This is a clear metric of narrow market participation, where a small number of large-cap stocks are driving the index's gains while the rest of the market lags behind.
This does not necessarily signal an imminent crash, but it is a divergence that warrants attention. Such conditions can indicate that a rally is running on thin ice. The fact that the $VIX is jumping today by over 6.3% adds another layer of caution, as the $Cboe Volatility Index(VIX)$ measures market volatility and is often seen as a fear gauge.
The $S&P 500(.SPX)$ also presents less than 50% of its stocks above the 20DMA.
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