{"id":62117,"date":"2025-07-12T06:13:36","date_gmt":"2025-07-12T06:13:36","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=62117"},"modified":"2025-07-12T06:58:13","modified_gmt":"2025-07-12T06:58:13","slug":"us-market-leading-indicators-8","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2025\/07\/12\/us-market-leading-indicators-8\/","title":{"rendered":"US Market Leading Indicators"},"content":{"rendered":"
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\"Bull\/Bear<\/div>\n
\"Stock<\/div>\n<\/div>\n

The gauge on the left indicates bull or bear market status, and the one on the right reflects stock market drawdown risk.<\/p>\n

Bull\/Bear Market<\/h2>\n

The Bull\/Bear indicator remains at 60%, with two of five leading indicators signaling risk-off:<\/p>\n

\"Bull-Bear<\/p>\n

The Chicago Fed National Financial Conditions Index declined to -0.51, reflecting strong liquidity in financial markets. Values above zero indicate restrictive financial conditions.<\/p>\n

\"Chicago<\/p>\n

Weekly continued claims are climbing, warning of a deteriorating labor market despite the low 4.1% unemployment rate.<\/p>\n

\"Continued<\/p>\n

Stock Pricing<\/h2>\n

Stock pricing eased slightly to 97.34 percent, compared to a low of 95.04 percent in April and a high of 97.79 percent in February. The extreme reading warns that stocks are at risk of a significant drawdown.<\/p>\n

\"Stock<\/p>\n

We use z-scores to measure each indicator’s current position relative to its history, with the result expressed in standard deviations from the mean. We then calculate an average for the five readings and convert that to a percentile. The higher that stock market pricing is relative to its historical mean, the greater the risk of a sharp drawdown.<\/p>\n

Robert Shiller’s CAPE compares the current value of the S&P 500 index to inflation-adjusted earnings for the preceding 10 years. The multiple of 37.69 is similar to the last leg of the Dotcom bull market in 1999, warning that stocks are dangerously overpriced.<\/p>\n

\"Robert<\/p>\n

Conclusion<\/h2>\n

We are bordering on a bear market, with the bull-bear indicator at 60%. However, extreme stock pricing increases the risk of a significant drawdown.<\/p>\n

Acknowledgments<\/h4>\n