All 5 index funds in uptrends
SPY: uptrend since Aug 4 (18 sessions).
- SPY▲
- QQQ▲
- IWM▲
- RSP▲
- IGV▲
Last turn: SPY, Aug 4, downtrend to uptrend.
Average score
Solid uptrend+16 since Aug 26
Bottom line We see no clear edge on the S&P 500's direction. Over the next week, we expect the equal-weight RSP to beat QQQ, with moderate confidence, as chip and AI-debt stress weighs on the biggest companies and options positioning could magnify the slide into Friday's expiration. A QQQ close above $736.53 Friday would challenge that view; two straight SPY closes below $762 would turn us bearish.
Read the full narrativePositioning Pressure · Positive readings mean the flow proxies lean bullish and negative readings mean bearish, with labels such as Mild Buying, Buying Building or Strong Selling. The chart splits it into Index Flow and Stock Flow and marks four patterns: Capitulation, Distribution at Highs, Flow Divergence and Broad Activity.
Keep in mind · Despite the product labels, it does not identify institutions or see whether anyone bought or sold. Its inputs are proxies built from price, volume and options data, so Buying and Selling describe the proxies. Its outcomes are graded; no lead over price has been established.
Market regime · Risk-On means most markets moved as if investors were comfortable with risk; Risk-Off means they moved defensively; Mixed means no clear agreement. The history strip also marks Rotation (stocks flat while other markets moved) and Stagflation (gold up, stocks down, a strained yield curve). A day count shows how long the read has held. It is a different measure from the stance the evening brief states, which also weighs flow and positioning, so the two can disagree.
Keep in mind · It reads one day's moves, so it can change quickly. When markets disagree, it does not tell you which one will turn out right. It is not a forecast. The US dollar is not currently an input.
Credit signal · Junk bonds are sensitive to risk. When a high-yield bond fund moves in step with stocks, credit is Confirming. When it falls behind, especially while stocks hold up, the label turns to Warning. Advanced view adds the high-yield spread in basis points, for example HY 310bps.
Keep in mind · It is a one-day comparison and can flip often. Credit can lead or lag stocks; a Warning is a prompt to look closer, not a sell signal. The spread series is published with a short delay.
Yield curve (2s10s) · Longer bonds usually pay more than shorter ones, so the curve slopes up. When short-term yields rise above long-term ones, the curve is Inverted. Advanced view shows the 10-year yield minus the 2-year yield, for example 2s10s +45bps.
Keep in mind · Inversion has a long but imperfect record as an early sign of slowdowns, with very uncertain timing. The curve moves slowly and says little about the next few sessions.
Cross-Asset Context · Plain market values, with the day's change where available, showing what other markets are doing next to stocks. Nothing here is scored.
Keep in mind · These are reference values, not signals. Some series arrive late: the dollar index is published weekly, and crude and the credit spread can be a day behind.
FlowScore · FlowScore asks one question: is something out of the ordinary happening in this stock today? Higher scores mean today's trading looks less like the stock's usual day. In our record so far, high scores have been followed by larger than normal moves more often than chance. It does not say which direction.
Trend badge · The badge names the side the stock's trend is held on: Uptrend or Downtrend. While price moves against the trend it adds how far the test has gone: "holding" for a close just across the 21-day average, "tested 1/3" or "tested 2/3" for one or two of the three closes that would turn it, and "new" on the day it turns. Without enough history the badge shows the score and label instead, such as "+42 · BULL LEAN".
Keep in mind · It is non-directional: a high score can come before a drop as easily as a rally. It does not identify who is trading. Index ETFs use an older recipe, so an index score is not directly comparable with a stock's.
What · we score the trend on four components every trading day.
Maturity · how long has the trend held.
Stretch · how far is price from its 21-day average.
Slope · is the average itself rising or falling.
Stack · do multiple timeframes agree.
Output · the four pillars combine into a single Conviction Score (−100 to +100) and a regime label.
Not · not a turn predictor (slow at absolute tops/bottoms), not a buy/sell signal (it's a regime read), and not infallible.
Is · a daily read of which side each index fund's trend is held on. A trend turns only after three straight closes more than 0.25% beyond its 21-day average, so a dip reads as a trend being tested, not broken. Built on trend-following research (Faber, Weinstein, CBOE).
More · read the full methodology.
IWM in a downtrend. QQQ holding through a dip.
SPY: uptrend since Sep 23 (17 sessions).
Last turn: SPY, Sep 23, downtrend to uptrend.
Funds holding through a move count at a third of their strength in the score, so it reads lower while trends are tested.
Context for the trend, not a signal on their own.
| SPY's trend that day | Followed by a 10%+ drop |
|---|---|
| Firm uptrend | 10% |
| Uptrend holding through a dip | 18% |
| Downtrend | 25% |
The side sorts risk, not returns. In the same history, a first close against a trend became a turn about half the time, and a second about three times in four. About a third of new trends turned back within two weeks. These are past rates, not a forecast for today.
Each index fund's trend is read from its close against its 21-day average:
A trend turns only after three straight closes more than 0.25% beyond the average on the other side. Until then it is being tested, not broken.
What · two scores (0 to 100) on the same six factor blocks, smoothed differently.
Pulse · fast read (1 to 3 day). Designed to react to stress within 1 to 2 sessions and stay sticky on greed.
Tide · slow read (10 to 15 day). Structural backdrop; requires multi-day confirmation to change band.
Bands · each score lands in one of five bands. Watch the day counter for how long a band has held, and the cooling or intensifying tag for which way it's moving inside the band.
Divergence Alert · fires when two or more factor blocks disagree (e.g. credit not confirming a rally). Empirically rare and worth attention, but a watch signal, not a sell signal.
Not · not a buy/sell signal (it's a sentiment read), not infallible (hit rates will be published after T+60 days), not CNN's Fear and Greed (built on richer inputs).
Is · a daily composite of credit, vol/dealer, flow, breadth, cross-asset, and curve. Smoothed with asymmetric EMAs so it flips fast on stress and slow on greed. Dealer-aware (GEX, 25Δ skew), which is what CNN's index misses.
Fear readings have tended to start near short-term lows (in a replay of Pulse back to 2008, 64% began near a local S&P 500 low (within about a week and a half), against 29% by chance). This one is well past its start, so that pattern doesn't speak to today, and it has never forecast returns.
From the overnight change in open interest. A put can hedge a holding as easily as bet on a fall, so this shows where traders added positions, not which way they lean.
Today's Flow Leaders · This Signal Lab list shows the five stocks, from everything we track rather than just your watchlist, where today's trading looks least like normal. Each carries a short reason, such as "Move risk led by volume surge", naming the input that pushed its score highest.
FlowScore · FlowScore asks one question: is something out of the ordinary happening in this stock today? Higher scores mean today's trading looks less like the stock's usual day. In our record so far, high scores have been followed by larger than normal moves more often than chance. It does not say which direction.
Move Watch · Move Watch appears when a stock's FlowScore reaches 60. It reads High from 60 to 69 and Extreme at 70 and above. It marks stocks where today's activity is far enough from normal that we treat the risk of a bigger than usual move as elevated. It does not say which way.
Flow trend · Flow Building +12 means the stock's FlowScore is 12 points higher than it was five sessions ago. Flow Surging marks a larger jump from an already active level. Both say attention on the stock is growing; neither says whether the price will rise or fall.
Keep in mind · A ranking of attention, not a list of trades. A stock can lead because of one rare print or a short burst of options activity. It says nothing about direction.
Thursday's session, in full
Prices charged by producers rose 1.3% in September, the biggest monthly jump since 2022 per Dow Jones, and the market split along a clear line. RSP, a fund that gives every S&P 500 company the same weight, rose 1.37%, and so did the small-company fund IWM. Among the same 135 stocks we track, the share trading above their 21-day average climbed to 42% from 30%. Health care closed at its highest level in more than a year.
The Nasdaq-100 fund, QQQ, fell for a fourth day. It has now closed below the band around its 21-day average twice in a row; a third such close would confirm that its uptrend has turned. In past cases, about three in four of these tests did turn. A close Friday at or below $736.53, about 1.2% above Thursday's close, would do it. The damage sits in chips and the AI trade. The semiconductor fund is down 8.6% in five days, and the cost of insuring AI cloud provider CoreWeave's debt against default hit a record. The market's biggest theme now has a borrowing-stress problem.
Government bonds rallied despite the hot inflation number. Junk bonds rose too, but almost entirely because Treasuries did. The extra yield riskier borrowers pay over Treasuries widened about half a percentage point over the month through Wednesday and has not come back in.
Traders are leaning defensive. They bought protection against declines in the S&P 500 fund aggressively, and bearish options trading in IWM hit its highest level in a month. Most of the options positioning estimated to steady the S&P 500 fund expired Thursday, and QQQ's positioning could magnify moves around Friday's monthly expiration. Calm short-term volatility expectations argue against stress already in place, not that a chip shock is absorbed. Large bullish bets on tech funds argue the other way.
On our calls: Wednesday we said junk bonds (HYG) back above $76.90 with IWM above $275 would undercut our view. Both happened, IWM by 8 cents, so we withdraw that call. The weekly outlook's hold above SPY $774 failed, but its formal line, two closes below $762, is untouched.
Session character · It describes how much each index fund may move, not which way. Coil means the next session looks quieter than usual for that fund, and Expand means louder. As the card says: Index character only. Not a direction call.
Keep in mind · Dealer positioning is modeled from open interest, not observed. It says nothing about direction, covers only these three index funds, and single stocks can behave differently.
Index character only. Not a direction call. Single names can diverge.
Ranked prints · We keep a list of each stock's largest single trades over roughly the past decade. When today's trade joins that list, we say where it ranks, for example "3rd-largest in our records". A #1 is the largest single print we have for that stock in the past decade.
Keep in mind · A large print shows size, not intent. We cannot see who traded or whether it was a buy or a sell. A newly tracked stock's prints are ranked only once its ten years of history has been loaded.
Institutions executed $75.8M of long exposure on QQQ as it declined 1.5% over the past two weeks — outsized print regardless of trend.
What · tracks what the biggest institutional traders are doing across the market each day. Are they buying or selling? How aggressively? And is that building over multiple days?
Gray line · index-level flow (SPY/QQQ).
Amber line · individual stock flow. When the two lines move together, conviction is high. When they split apart, something is shifting underneath.
Green dots · institutions buying into a decline. Often near bottoms.
Red dots · institutions selling after a sustained rally.
Blue dots · index flow and stock flow are moving in opposite directions.
Intensity · bigger dots mean stronger signal. Intensity-3 signals also draw a brighter vertical line and a colored pattern badge at the top of the chart (C, D, Div, B for capitulation, distribution, divergence, broad activity).
Tinted bands · when the same pattern fires for two or more sessions in a row, the cluster gets a faint background tint matching the pattern color.
Important · these signals track institutional positioning, not price direction. They typically lead price by 1 to 5 trading sessions. Purple ticks at the top mark options expiration days (OpEx).
Index Flow −21Strong sellingStock Flow −2Neutralas of 10/15
Built from options and trade-flow proxies. It does not show who bought or sold, and no lead over price has been established.
VIX term structure · VIX is the volatility options traders price into the S&P 500 over the next 30 days; VIX9D covers 9 days and VIX3M three months. Usually longer horizons price higher (Contango). When short-term volatility prices above longer-term, the curve is Inverted. In the email, a 9D/3M ratio above 1 shows in red.
Keep in mind · It describes how options are priced right now. An inversion can resolve within days or persist through a selloff, and the curve does not say which way the index will move.
Closing Tape Pulse · Many funds trade in the closing auction at 4:00 pm. On a busy day the panel shows how many closes ranked among each stock's largest, the sector with the biggest share, any record closes, and an Index rebalance tag on known rebalance days. Quiet days show one muted line.
Keep in mind · Accumulation and Distribution describe price action around the closing print, not who traded or which side they took; every closing print matches buyers and sellers in equal size. Rebalance-day volume is largely mechanical.
No notable institutional concentration in today's closing auction.