Stock Market’s Character Has Changed – Here’s How

We’re watching the VIX or “fear index” to see what’s next

Stock market investors naturally want to know the closing numbers for the main stock indexes at the end of each trading day.

Yet, it’s also good to dig deeper.

Let me show you some examples of how our U.S. Short Term Update, a thrice weekly publication which covers near-term trends of key U.S. financial markets, does just that.

Let’s start off with a quote from the Aug. 21 issue:

NYSE down volume outpaced up volume 52.7% to 47.3%. Internally, today’s rally in the S&P and NASDAQ was meek.

Here’s a review of a revealing indicator from our Aug. 16 U.S. Short Term Update:

The NYSE a/d ratio has closed negative or flat for seven straight days. It’s the longest streak in nearly a year, since August 26, 2022 to September 6, 2022. The 10-day NYSE a/d ratio closed yesterday (Aug. 15) at .80, which is the most negative also since September 2022.

Another observation of the market’s internal dynamics was mentioned by the Aug. 9 U.S. Short Term Update:

The VIX made a closing low on June 22 and failed to confirm the S&P’s higher price extremes. That was an initial warning sign that market participants were becoming a bit more fearful and expecting a pickup in market volatility.

So, it appears the character of the stock market has changed.

These negative indicators are in stark contrast to measures of stock market sentiment during the past several weeks, some of which reached bullish extremes.

For example, consider the Advisor and Investor Model (AIM) from That’s a blend of over 50 sentiment readings from five different sources, including Market Vane and Consensus Inc., two of the oldest services.

Our August Elliott Wave Financial Forecast provides some insights:

This comprehensive model hit a new 3½-year extreme of 0.99 on July 25. The extreme during the topping process was a reading of 0.96 on April 16, 2021, which occurred as the most speculative issues completed their tops.

Indeed, as recently as Aug. 14, none other than had this headline:

Reasons to Still Believe In This New Bull Market

In Elliott Wave International’s view, the S&P 500 index never entered a “new bull market” since the January 2022 top and the subsequent downturn. Yes, there’s been a rally since that first leg down, but the January 2022 peak has not been breached.

The stock market’s Elliott wave structure puts that rally into context.

No, the Elliott wave model offers no guarantees, but from our 40-plus years of applying it to the markets, we know it also gives you an objective, noise-free snapshot of where things are — and where we’re headed.

Follow the link below to tap into our latest stock market insights now.

How to Land Safely on the RIGHT SIDE of Stock Market History

A few select days prove to be momentous in stock market history: such as the start of a rip-roaring bull market, or the day which marked the beginning of a harrowing bear.

And at these times, investors like you want to be on the right side of stock market history. The message in our August Financial Forecast Service helps put you there.

Our main investor package also provides you with Elliott wave analysis of bonds, gold, silver, the U.S. dollar and more.