Market Monitor Trends and Breadth August 8 BMO - Market Breadth Falters Again as Momentum Cools After Strong Start to August

(All data & visualisations by ChartMill.com)

Daily Market Trend Analysis – August 7, 2025 (After Market Close)

Index ETFs started strongly but lost momentum toward the end of the session.

Short Term Trend

SPY (S&P 500 ETF)

• Short-Term Trend: Bullish (from neutral)
• Next Support at $620 - $600
• Next Resistance at $640
• Volume: At Average (50)
• Pattern: Down Day - Gap Up

QQQ (Nasdaq-100 ETF)

• Short-Term Trend: Bullish (no change)
• Next Support at $550 - $540
• Next Resistance at $575
• Volume: At Average (50)
• Pattern: Down Day - Gap Up

IWM (Russell 2000 ETF)

• Short-Term Trend: Neutral (no change)
• Next Support at $220 - $215
• Next Resistance at $226
• Volume: At Average (50)
• Pattern: Down Day - Bearish Engulfing Candle

Long Term Trend

SPY (S&P 500 ETF)

• Long-Term Trend: Positive (no change)

QQQ (Nasdaq-100 ETF)

• Long-Term Trend: Positive (no change)

IWM (Russell 2000 ETF)

• Long-Term Trend: Positive for now (from neutral), waiting for confirmation close (weekly candle)

Daily Market Breadth Analysis – August 7, 2025 (After Market Close)

The latest breadth numbers from August 7 reflect a notable deterioration in overall participation across U.S. markets, following what had been a robust breadth spike on August 4.

The data shows that while prices did not collapse, internal strength weakened again, hinting at a lack of conviction and potentially rising indecision among market participants.

Daily Participation and Momentum:

• Advancing vs. Declining: On August 7, only 44% of stocks advanced, while 52.5% declined, a clear deterioration from the near-even split of August 6 (50.3% advancers) and a sharp reversal from the 80.4% advancing breadth seen on August 4.

• Strong Movers (±4%): The percentage of stocks advancing more than 4% was 4.5%, slightly higher than the prior day but still unimpressive. Meanwhile, 5% of stocks declined 4% or more, the worst reading since August 1, again showing mild downside expansion.

Overall, these figures mark a second consecutive day of fading breadth momentum, following what had appeared to be a promising start to the month.

Moving Averages – A Topping Look?

• Stocks Above SMA(20) changed slightly to 46.7%, from 46.5%, but are still well off the August 4 level of 42.2%.

• SMA(50)+ and SMA(100)+ both declined modestly:

• SMA(50)+ fell to 59%, from 60.3%

• SMA(100)+ ticked down to 66%, from 66.8%

• The SMA(200)+ stayed flat at 51.3%, showing that long-term participation remains stalled just above the 50% threshold, signaling indecision.

These rolling averages suggest that the recent move higher failed to bring significant new breadth strength into the market. There is no sign of a broadening uptrend taking hold yet.

New Highs vs. Lows (NH/NL):

New Highs dropped back to 4, while New Lows inched higher to 1.8%, a slight deterioration after two consecutive days of improvement.

The modest rise in new lows shows that while weakness isn’t widespread, the leadership on the upside is still too narrow to support a solid advance.

Short- and Medium-Term Trends (Week, Month, 3-Month):

• Advancing over 1 Week: Down to 52.8% from 47.3%, a modest improvement but still tepid.

• Declining over 1 Week: Rose to 46.3%, suggesting mixed weekly trend data.

• 1-Month Advancers ticked down to 45.2%, still below the 50% threshold. Meanwhile, 1-Month Decliners climbed to 54.1%, further confirming medium-term weakness.

3-Month Trends:

• Advancers at 69.5% still suggest a generally strong longer-term uptrend.

• Decliners stayed at ~29.7%, flat vs. prior days.

• 25% Gainers over 3 Months: Slight drop to 16.2%, down from 16.4% on Aug 6.

• 25% Decliners over 3 Months: Rose to 5.5%, from 5.2%.

These numbers confirm that short-term momentum is fading, even as longer-term trends remain intact – a sign of a possible consolidation or pause within an ongoing bull phase.

Trend Continuity vs. Reversal

The spike in breadth on August 4 was the most significant in the last 10 days (80.4% advancers, 5.6% 4%+ advancers), but instead of seeing a multi-day continuation, the rally appears to have fizzled. The following three sessions (Aug 5–7) have all returned to sub-50% advance-decline ratios.

This continues a familiar pattern observed during late July and early August, where positive sessions are not getting strong follow-through. The rally attempts are largely event-driven or sentiment-based, with August 4 likely influenced by strong earnings surprises or dovish Fed rhetoric, but failing to gain lasting traction.

Current Breadth Trend Rating: 3 – Neutral

Despite some strength in the 3-month breadth, the lack of follow-through from August 4 and the return to mixed daily and weekly metrics push the trend back into neutral territory.

While there’s no major breakdown, the market appears to be cooling off, awaiting new catalysts. A more decisive move – in either direction – will be needed to shift this assessment.

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Kristoff - ChartMill

Next to read: Market Monitor News, August 8