Tech Leads the Rally, But Breadth Signals Are Flashing | Sevens Report Weighs In
Tom Essaye says the rally looks healthy—but it’s not without warning signs
Tech stocks are powering this record-setting rally on Wall Street – but how long can it last?
RECORD HIGHS GET SUPPORT FROM NYSE BREADTH, BUT 200-DAY INDICATORS TELL A DIFFERENT STORY
Wall Street’s rally to new highs continues to be led by tech stocks, but according to Tom Essaye, founder of Sevens Report Research, the strength may be broader than it looks—though not without its risks.
“The recent advance is broad-based… historically healthy and likely sustainable.”
— Tom Essaye, Sevens Report
Essaye pointed to new highs in the NYSE Advance/Decline (A/D) line, a key signal that the rally has expanded beyond just megacap names.
But there’s a catch: only about 50% of S&P 500 stocks are trading above their 200-day moving averages, according to Sevens Report data—well below May’s 55% high.
“The divergence… is a source of concern,” Essaye wrote. “Some areas show real strength, while others may just be staging bear-market rallies.”
For bulls, Essaye says confirmation would come from more S&P names clearing their 200-DMAs—surpassing the May threshold of 55% would help validate the rally’s staying power.
Also, click here to view the full article published in MarketWatch on June 28th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.
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