FEAR & GREED INDEX 62
Weekly Update
The Fear & Greed Index (found on cnn.com) is one of the easiest indicators to use to determine current market emotion. This simple to read gauge, highlighted in our publication When to Buy and When to Sell: Combining Easy Indicators, Charts, and Financial Astrology (available on Amazon), is measured in a range from 0-100, and currently reads 62 as of the close on Friday, May 30, 2025.
This figure remains in the lower Greed level, declining only 2 points from last week’s close of 64. This was slightly divergent with the S&P 500, which rose about 108 points from 5,803 to 5,911, for a small gain. For several weeks we have focused on the fact that the four major indexes, which include the S&P 500, Nasdaq, Dow Jones Industrial, and Russell 2000 (small cap index), remained in bear market territory (when over 50% of their components continue to trade under their 200-day moving averages). Currently, only the DJIA remains above that level, at 63%, while the Nasdaq slipped back to 44% (though the Nasdaq 100 remains above at 55%). The S&P 500 is close at 46%, however, the Russell 2000 remains in deep bear territory at only 32%. Overall, as noted, the recent Bear market condition improvement remained about the same, as approximately 40% of all stocks contained within these 4 major indexes are now trading over their 200-day moving averages (up from 38% last week).
The “Risk-On” sentiment waned a bit this week, as Consumer Sentiment remained at historic lows, and the stubborn 10-year bond yields only improved slightly from 4.49%, to 4.4%, as investors remained uncertain on the heels of the U.S. debt downgrade by Moody’s from AAA to AA last week. Normally this results in higher borrowing costs for consumers, despite the rating remaining quite high.
The 7 internal factors used to formulate this index are listed on the screen (below):
Market Momentum – (S&P 500 vs its 125-day moving avg) = EXTREME FEAR
Market Volatility (measured by the VIX) = NEUTRAL
Put to Call Ratio 5-day avg. (# of Puts (bearish) vs Calls (bullish) = FEAR
Stock Price Strength (# of new 52-week highs vs new 52-week lows) = GREED
Stock Price Breadth (# of shares rising vs falling on NYSE) = EXTREME GREED
Safe-Haven Demand (which measures stocks vs bonds) = GREED
Junk Bond Demand (non-govt. bond yield spread) = EXTREME GREED
This week, only 1 of these 7 factors changed levels, as 4 of the 7 remain in Greed or Extreme Greed. The fact that Market Momentum remains at a low level (as it does take time for a 125-day moving average to rise after a steep drop), suggests investors should remain cautious. The only change was the slight drop of Safe-Haven Demand, though that was insignificant. The continued level of the Put to Call Ratio (Fear) also suggests caution, as this measure is a leading indicator reflecting more bearish sentiment, at least in the short term.
The VIX itself, measured by Market Volatility, though still in Neutral territory, dropped from 22.3 to 18.6, signifying less market nervousness, as price action became more non-directional.
This week’s news was highlighted by very positive earnings and strong forward guidance from leading chip company Nvidia, as well as the court order blocking discussed global tariffs, both of which occurred after the close on Wednesday, igniting a rally on Thursday. The rally fizzled on Friday, however, as it often does, with profit-taking and another court order placing a temporary “stay” on the tariff “block” the day before. Earnings season has almost ended, though the issue of forward guidance lingers for many companies, as the unresolved tariff situation does not allow them to properly gauge their future sales/revenue. Keep in mind that recession fears have not been fully quelled, with the Fed’s continuous inconsistent remarks regarding the economy from one week to another, combined with mixed economic reports. This week, the vast majority of CEOs (83%) also said they expect a recession in the next 12-18 months, nearly matching the percentage who feared recession in late 2022 and early 2023.
Astrologically, the planet Mars has almost completed its stay in the sign of Leo (2 more weeks). As noted, during the same transit from early November to early January, markets reached their highs after the election, and so far, the trend has again been bullish. However, Mars is in opposition to Pluto, and Pluto turned retrograde (2 weeks ago) in the sign of Aquarius (until mid-October). Pluto is known to break down and restructure, while Mars likes to go full speed ahead, so beware more push and pull in the price action in the next few weeks.
Gemini season (May 21 – June 20) is now in full effect. Gemini, an air sign, re-ignites the indecisive, push and pull energies, which replaced the calm and steady Taurus. Please review our Sign Language – Gemini Season blog, dated 5-10-25 for more details. As the planet Mercury also entered Gemini (one of its two “home” signs) last weekend, the overthinking, back and forth uncertainty will increase over the next few weeks, which usually results in extra market volatility.
Other transits of note include the upcoming Venus into Taurus ingress, which commonly results in strong moves in Bitcoin, as well as the entry of Jupiter into the sign of Cancer, which may ignite a rally in silver. (Please review our recent Trader Transits – Jupiter in Cancer blog, dated 5-22-25. The planet Saturn’s recent move into the sign of Aries, where it will remain for about 2 ½ years, also signifies a restriction on the recent aggressive energies. Please also review our recent Trader Transit – Saturn in Aries blog, dated 5-8-25 for further details.
As discussed in the past few weeks, the “Sell in May and Go Away” seasonal concept is also upon us. As published in last year’s blog, dated 4-15-24, and our recent blog, dated 4-18-25, that effect has not held true nearly as much in recent years. Combining algorithmic, programmed machine trading, with the seasonally strong July (now the 2nd best performing month of the year), and May seemingly no longer following that seasonal trend, this strategy may no longer be true, as it again did not follow that script again this year (6.1% gain).
Leading sectors with over 50% of stocks trading over their 200-MAs continue to include only Communications Services and Utilities (both over 78%). Financials (62%) also gained momentum, while Industrials and Consumer Discretionary moved just above that mark. In the long run, sectors of the technology industry are likely to continue their advance into the future, including AI, robotics, quantum computing, and space development (with Pluto in Aquarius, and Uranus upcoming ingress to Gemini in mid-2025).
Gold (ruled by the Sun), and Silver (ruled by the Moon), slumped just a bit this week. As we noted the last few weeks, the pullback was likely, as Mars remains in Leo, after its 2nd recent successful stay in Cancer. Jupiter (expansion) will be entering Cancer (ruled by the Moon) next week, however, which signifies a potential much-anticipated rally in silver, as the Moon rules that metal. Also, the Gold to Silver Ratio (covered in our publication) remained disproportionate after closing at 100.4 last week, decreasing less than 1 point to 99.7 this week, indicating silver continues to be a better value buy than gold. As we have expressed in recent months, any dip in these metals has been short-lived, and they continue to be long-term buying opportunities on any such declines.
***As always, this information is not intended to be financial advice, or any specific buy or sell recommendation, but rather a guide to assist the reader in some further understanding of current economic conditions/movements in the sky, and how they can affect moods, behaviors, world events, and financial markets.
