Bearish outcomes are more likely in a bear market and this is playing out as even the defensive groups were hit with selling pressure on Wednesday. We are also seeing this play out in certain commodities, such as industrial metals. Industrial metals

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Stocks became extremely oversold last week after strong selling pressure and sharp declines. We are seeing an oversold bounce right now, but this is considered a bear market bounce because the Composite Breadth Model is net bearish and yield spreads show serious stress in the credit markets.

This page shows the current Market Regime using the Composite Breadth Model and the situation in the credit markets with yield spreads. These indicators are very different, but they go hand in hand when assessing the state of the financial markets.

Stocks became extremely oversold last week after a sharp five day decline that looked like a selling climax. This five day decline was already on top of a sharp decline from April 21st to 27th (-8.5%). All told, there was

Stocks remain under pressure and failed to bounce after becoming quite oversold after a three-day decline on Tuesday. This decline continued with many stocks and ETFs becoming even more

The bear market widened its grip on stocks as more participated in the decline over the last few weeks. New lows expanded dramatically the last two weeks and more stocks are below their 200-day SMAs. Safe-haven groups were also hit as utilities and consumer staples fell. The safe-haven groups are

The ugly just got uglier. The Composite Breadth Model turned bearish on April 11th and the 5-day SMA for the S&P 500 crossed below the 200-day SMA that same day. At worst

Market volatility was also high and seemed to get even higher the last two weeks. Moreover, volatility and selling pressure are not just in the stock market. We saw selling pressure in almost all groups over the last five

The Composite Breadth Model remains bearish and we are in a bear market environment for stocks. Oil and agricultural commodities remain relatively strong, but industrial metals were hit pretty hard the last two weeks. Downside participation

The weight of the evidence remains bearish for stocks and participation to the downside expanded significantly over the last six trading days. Even the low volatility leaders were hit hard and there were few places to hide as correlations rose among stocks. Bonds managed to firm, but do not offer an alternative to stocks

The Market Regime is bearish and this means there is a headwind for stock-related ETFs. At the very least, we should be extremely selective and reduce exposure to stocks. Even though we will still have sharp oversold bounces,

It is not pretty out there. The Composite Breadth Model is bearish and yield spreads are rising. We are also seeing large-techs (QQQ) and small-caps (IWM) lead the broader market lower. Selling pressure intensified with lopsided down days on Friday and Tuesday. Basically