The composite has improved slightly from yesterday’s -36 RISK OFF reading to -25, pulling back into CHOP territory. SPY sits at $653.18 with an RSI of 29 — still deeply oversold — while the VIX has eased from 27.5 to 25.7. The medium-term score improved from -92 to -75, though it remains firmly in RISK OFF. The long-term score sits at exactly zero — right on the knife’s edge between CHOP and RISK OFF, with 45% of stocks above the 200-day MA. Breadth has ticked up modestly with 23% above the 20-day MA and 26% above the 50-day.

Sector Leadership

Five sectors remain in RISK OFF, but the bleeding has slowed:

💡 What We’re Watching

• Long-term score sits at exactly zero — This is the most important number in today’s report. The long-term timeframe is balanced on the edge between CHOP and RISK OFF. With 45% of stocks above the 200-day MA, the market’s structural foundation is neither healthy nor broken — it is right at the tipping point. Which way this resolves will likely define the next several weeks.
• VIX eases from 27.5 to 25.7 — Still elevated, but the pullback from yesterday’s peak is a modest positive. A sustained decline in the VIX below 22 would be one of the signals we look for in a durable bottom. We are not there yet, but the direction is encouraging.
• Healthcare improves from -52 to -35 — The most notable sector improvement today. The long-term score recovered from zero to +30, suggesting some structural support is returning. Still in RISK OFF, but the trajectory has shifted for the first time in weeks.
• Medium-term improves from -92 to -75 — Still deeply negative, but the improvement from near-maximum bearish levels is worth noting. The 50-day breadth improved from 23% to 26%. The medium-term timeframe tends to be the slowest to recover, so any movement in the right direction is meaningful.

The Bottom Line

For the first time in several days, the market’s internals have improved rather than deteriorated. The composite moved from RISK OFF back to CHOP, the VIX pulled back from its correction highs, and several sectors showed modest score improvements. These are small steps, but they represent the first change in direction we have seen.

That said, five of eleven sectors remain in RISK OFF, the RSI is still at 29, and the long-term score at zero tells us this market is far from healthy. In our view, today’s data suggests the pace of deterioration has slowed, but a sustainable recovery requires more than one day of stabilization. Expanding breadth, declining VIX, and sectors transitioning out of RISK OFF are the milestones we are watching for.