{"id":63461,"date":"2026-01-10T10:04:38","date_gmt":"2026-01-10T10:04:38","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=63461"},"modified":"2026-01-10T10:04:38","modified_gmt":"2026-01-10T10:04:38","slug":"us-market-snapshot-6","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2026\/01\/10\/us-market-snapshot-6\/","title":{"rendered":"US Market Snapshot"},"content":{"rendered":"
\n
\"Bull\/Bear<\/div>\n
\"Stock<\/div>\n<\/div>\n

The gauge on the left indicates whether the market is in a bull or bear phase, and the indicator on the right reflects the current stock market valuation. Stock market pricing indicates whether stocks are cheap or expensive in relation to earnings, but it is a poor indicator of market timing<\/strong>. We do not recommend selling stocks because market valuations are high; however, we recommend exercising caution when adding new positions.<\/p>\n

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

The Bull\/Bear indicator remains at 40%, warning of a bear market ahead, with three of five indicators signaling risk-off.<\/p>\n

\"US<\/p>\n

Continued unemployment claims increased to 1.914 million on December 27, up more than 500K since their June 2022 low of 1.349 million. However, the December unemployment rate of 4.4% remains below the 5.0% threshold typically associated with a recession.<\/p>\n

\"Continued<\/p>\n

Heavy truck sales are trending lower, with the 12-month moving average falling to 34K units in December. The decline of more than 10% from the October 2023 high of 43K is typical of a recession and signals risk-off.<\/p>\n

\"Heavy<\/p>\n

Employment in cyclical sectors \u2014 manufacturing, construction, transportation, and warehousing \u2014 represents only 17% of total nonfarm employment in the US, but typically accounts for most job losses during a recession. The decline of 164K from its February 2025 peak indicates that the economy is slowing, and a drop of 300K would signal risk-off.<\/p>\n

\"Cyclical<\/p>\n

Stock Pricing<\/h2>\n

Stock pricing increased to 98.34 percent from 98.16 percent last week, close to the October high of 98.66, compared to a low of 95.04 percent in April. The extreme pricing warns that stocks are at risk of a significant drawdown.<\/p>\n

\"US<\/p>\n

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

The S&P 500 Forward Price-Earnings at 24.3 is high relative to its 50-year moving average of 16.4. In the past 125 years, the current peak has been exceeded only by the 2000 Dotcom bubble.<\/p>\n

\"S&P<\/p>\n

Conclusion<\/h2>\n

The bull-bear indicator at 40% warns of a bear market ahead, while extreme price levels increase the risk of a significant drawdown.<\/p>\n

Acknowledgments<\/h4>\n