S&P 500 Just Broke a 6-Month Streak—What Comes Next?

The broad market just flashed a rare signal. After trading above its 50-day moving average for 198 consecutive days (the longest streak since 2007), the S&P 500 dipped below it on Nov. 20—marking only the fifth time this has happened since 1950.

The Numbers

• S&P 500 peaked at 6,890.89 on Oct. 28, then pulled back 5.1%
• 198-day streak above 50-MA: longest run in 18 years
• Current CAPE ratio at second-highest level ever (dot-com era was highest)

Here’s the Thing Though

Historically, this isn’t a bearish omen. When the S&P 500 ended similar long streaks before (2016-17, 2017-18, 2023-24), the market averaged +8% gains over the next six months. The 2007 crash was the exception—but that streak ended months before the actual peak.

Why the Market’s Stumbling Now

Weak macro signals are piling up: job growth flat-lining, consumer spending cooling, auto loan delinquencies rising, and AI bubble concerns. The AI rally that drove 2024’s gains is hitting fatigue.

The Real Risk

The 50-MA break isn’t the problem—it’s the valuation. The S&P 500 is expensive by historical standards (CAPE ratio), and the macro backdrop is murky. Expect more volatility before clarity emerges.

Bottom line: This technical breakdown is noise, not a crash signal. But combined with stretched valuations and economic uncertainty, it’s a yellow flag, not a buy-the-dip moment.