CNN Fear & Greed Sentiment Analysis 2026-08-13

Composite Index

The monthly gain of +15.3 is the most striking number — a month ago the market was in fear territory (46.8), and has since steadily climbed into greed. The year-over-year comparison is essentially flat (-0.1), indicating sentiment has returned to the same level as a year ago.

Last 10 Days Trend

Key inflection at 08-03 → 08-04: a +9.3 single-day jump from neutral directly into greed. Since then, the market has held greed territory. The last three days show a mild pullback (64.7 → 61.4 → 62.1), but still firmly mid-greed. Trend direction: weakening within the greed zone.

7 Sub-Indicators Scan

Sub-Indicator Breakdown

• Market Momentum (71): S&P 500 well above its 125-day MA, trend intact. But momentum has stalled recently with the index flatlining around 7748.
• Stock Price Strength (30.4): The weakest link. New highs/new lows ratio dropped to 0.968, meaning more stocks are hitting new lows than new highs. The index rises but individual stock leadership is narrowing — an early breadth deterioration signal.
• Stock Price Breadth (50.6): McClellan Oscillator slightly up at 1005, breadth barely neutral. Advancers marginally exceed decliners, but not convincingly.
• Put/Call Options (64): P/C ratio at 0.708, options market slightly bullish. But marginal decline from prior day suggests waning bullish conviction.
• Market Volatility (50): VIX at 14.55, extremely low. Low volatility itself reflects complacency, meaning the market is pricing insufficient risk premium.
• Junk Bond Demand (98.2): Extreme value alert. HY bond spread at just 1.216%, near historically tightest levels. Credit markets are pricing virtually zero risk — a stark contrast with Stock Price Strength at 30.4.
• Safe Haven Demand (70.8): Ratio rose from 3.24 to 3.74, indicating reduced demand for safe havens (higher ratio = stocks outperforming Treasuries). Market is rotating away from safety.

Structural Divergence Analysis

🔴 Core Divergence: Credit Euphoria vs Equity Breadth Deterioration

The 68-point gap between Junk Bond Demand (98.2, Extreme Greed) and Stock Price Strength (30.4, Fear) is the most prominent structural contradiction:

• Credit side: HY bond spreads at 1.216%, investors demanding almost no risk premium. Capital is flooding into credit, pushing prices up and spreads to historic tights.
• Equity side: Fewer stocks making new highs than new lows. The index is supported by mega-cap names while the broad universe shows fatigue.

This divergence is historically a late-cycle bull market hallmark — when credit markets are maximally optimistic, risk premiums are compressed to the extreme, while equity breadth deterioration signals weakening internal market structure. These two don’t diverge forever; convergence typically comes via spread widening (credit catches down) rather than stock strength recovery.

🟡 Secondary: Low VIX + Weak New Highs

VIX at 14.55 is low, yet Stock Price Strength is only 30.4. Low volatility masks individual stock-level divergence — a calm index doesn’t mean all stocks are healthy. If breadth continues to deteriorate, volatility will eventually catch up.

Trend Assessment

• Greed zone duration: 7 consecutive trading days in greed (08-04 through 08-12), following approximately 2 weeks in neutral.
• Direction: Last 3 days pulled back from 64.7 peak to 62.1; greed momentum is weakening but no reversal signal yet.
• Key watch: If Stock Price Strength breaks below 25 AND Junk Bond Demand rolls over from extreme greed, it could signal a broader shift. Not confirmed yet.

🚨 Crash Signal Dashboard

1. Credit Spreads

• Trend: HY OAS at 2.72% remains in normal range (<3%), having tightened slightly from last month. IG OAS at 0.79% also normal (<1%). Credit spreads are uniformly compressed, consistent with the FNG sub-indicator Junk Bond Demand at 98.2 (Extreme Greed).
• Risk implication: Tighter spreads mean less room for future risk pricing. Not a crisis signal, but an over-optimism signal.

2. Yield Curve

• 10Y-2Y is normally positive (+48bp), the curve having recovered from prior inversion. But 10Y-30Y remains inverted at -54bp, the long end is abnormal.
• 30Y at 5.24% significantly above 10Y at 4.70%, indicating the market demands premium for long-term inflation/fiscal risk. Not a recession signal, but suggests rising term premium.

3. Margin Debt

• June margin debt surged $86B, from $1.416T to $1.502T, setting a new all-time record.
• YoY growth of +49% is staggering — margin debt has grown nearly 50% in 12 months. This is not normal growth; it’s leverage accelerating into the market.
• The last comparable leverage surges occurred in the late 2020-2021 bull market peak and pre-2008 housing bubble.
• Next release: August 28 (July data).

4. IPO Activity

• IPO count is below historical average, indicating the primary market isn’t overheated. Not a crash signal, but watch for sudden acceleration.

5. Fund Flows

• H1 ETF inflows of $1T nearly double the same period last year. Rolling 12-month at $2T is unprecedented.
• US equity ETFs attracted $441B, but non-US ETFs are also accelerating (34% share), suggesting capital is diversifying geographically.
• The flood of capital is pushing valuation expansion, but also means once sentiment turns, stampede risk is real.

Overall Assessment

Core Contradiction: Credit spreads and yield curves are within normal ranges, flashing no crisis signals. However, the explosion in margin debt and the torrential ETF inflows point to a market driven by liquidity rather than fundamentals. When leverage and fund flows both set records simultaneously, the market’s sensitivity to any liquidity tightening multiplies exponentially.

Overall Rating: 2🟢 / 1🟡 / 2🔴 — Structural risk accumulating, no imminent crisis signal.