A rare signal is flashing in the market that suggests the bull rally in stocks is about to peak

Ned Davis Research has identified a rare signal suggesting the bull rally in stocks may be nearing its peak. The firm noted that market breadth is deteriorating even as major indexes remain close to record highs. Specifically, fewer than 25% of S&P 500 stocks traded above their 50-day moving averages in the past week, and fewer than 45% traded above their 200-day moving average. According to the strategists, this divergence is rare and has historically preceded past market tops.

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