{"id":24750,"date":"2025-08-07T07:30:00","date_gmt":"2025-08-07T11:30:00","guid":{"rendered":"https:\/\/jeffclarktrader.com\/market-minute\/?p=24750"},"modified":"2025-08-06T12:16:29","modified_gmt":"2025-08-06T16:16:29","slug":"these-three-indicators-tell-me-the-nasdaq-uptrend-is-under-pressure","status":"publish","type":"post","link":"https:\/\/jeffclarktrader.com\/market-minute\/these-three-indicators-tell-me-the-nasdaq-uptrend-is-under-pressure\/","title":{"rendered":"These Three Indicators Tell Me the Nasdaq Uptrend Is Under Pressure"},"content":{"rendered":"

Managing Editor’s Note:\u202f<\/strong>Today, we’re hearing from our contributing editor Mike Burnick in his weekly Thursday feature. <\/p>\n

\u202fMike has over 30 years in the investment and financial services industry – from operating as a stockbroker, trader, and research analyst, to running a mutual fund as a registered investment advisor and portfolio manager, to being Research Director for the Sovereign Society, specializing in global ETF and options investing. <\/p>\n

\u202fAnd he’s been senior analyst at TradeSmith for three years, running\u202fConstant Cash Flow, Infinite Income Loop,\u202f<\/em>and\u202fInside TradeSmith<\/em>.\u202f\u202f <\/p>\n

\u202fHere’s Mike… <\/p>\n<\/div>\n

These Three Indicators Tell Me the Nasdaq Uptrend Is Under Pressure<\/h2>\n

BY MIKE BURNICK, CONTRIBUTING EDITOR, MARKET MINUTE<\/em><\/strong><\/p>\n

Since the April tariff-turmoil lows, stock market breadth has been excellent confirming the strong uptrend in stocks since then.<\/p>\n

I always keep a watchful eye on breadth measures as a way to check on the market’s health under the hood.<\/p>\n

This includes the difference in advancing vs. declining stocks, new highs vs. new lows, and the percentage of stocks in the index that are in healthy uptrends.<\/p>\n

Well, last week three market breadth indicators I follow turned down, after prolonged winning streaks. So, under the hood, stock market internals maybe aren’t firing on all cylinders.<\/p>\n\n

\"\"<\/figure>\n\n

First, as you can see above, the number of stocks hitting new one-year highs outpaced those making new lows for 30 straight days.<\/p>\n

But that win-streak came to an end with last week’s market pullback.<\/p>\n

Second, the technology sector had been on a stellar win streak of its own, trading one standard deviation above its 50-day price moving average for a stunning 55 straight days.<\/p>\n

That streak also ended with Friday’s pullback.<\/p>\n\n

\"\"<\/figure>\n\n

Third, as you can see above, the Nasdaq McClellan Summation Index has clearly turned down. I watch this indicator closely because it compares the average of advancing vs. declining stocks over different time periods.<\/p>\n

It’s a handy measure that shows you both the cumulative breadth and trend strength of the index.<\/p>\n

So, when the summation index above is moving up from left to right, it signals a healthy uptrend for Nasdaq.<\/p>\n

But when the index rolls over and begins to decline, it’s telling you the Nasdaq’s strong uptrend is losing momentum.<\/p>\n

Keep in mind, none of these breadth indicators give you a reason to bail on stocks immediately. But it certainly gets my attention – telling me there’s a possible disturbance in the force<\/em> of the market’s trend.<\/p>\n

That’s especially true for the tech-heavy Nasdaq index. That’s because Nasdaq has led the market higher since the April low.<\/p>\n

But these stocks are extremely overbought, and now cracks are showing up in the foundation of the rally.<\/p>\n

Just before the big tariff-turmoil market selloff in March and April, the number of new highs minus lows on Nasdaq went negative in mid-February.<\/p>\n

Also, the Nasdaq McClellan Summation Index turned down even earlier, and kept falling, even though Nasdaq itself moved sideways in a trading range.<\/p>\n

These were clear warning signs of trouble ahead back then, and sure enough, Nasdaq fell 27% over the next month and a half.<\/p>\n

Now we’re getting these same warning signs again.<\/p>\n

Bottom line<\/em><\/strong>: The decline in breadth tells me the uptrend in market-leading Nasdaq stocks may be under pressure. It could resolve itself in one of two ways: either a sideways trading range pause, or a steeper pullback in stocks. Now is the time to be prepared either way in advance.<\/p>\n

Good investing,<\/p>\n

\"Signature\"<\/p>\n

Mike Burnick
\nContributing Editor, Market Minute<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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