The Hidden Indicator Behind the S&P500’s Biggest Turning Points

Author: Cedric Thompson

Published: April 12, 2026

Key Points

• The S&P Bullish Percent Index (BPSPX) tracks the percentage of stocks on buy signals, providing insights into market participation beyond the price movements of large-cap stocks.
• A cross above 30 on the BPSPX indicates a strong bullish signal, with an 81.58% probability of positive returns over a 9-month period.
• This indicator is more effective for intermediate to long-term analysis rather than short-term trading, with a cross below 50 indicating heightened risk of market weakness.

Understanding the S&P Bullish Percent Index

The S&P 500 Index is market-cap weighted, meaning that large companies can disproportionately influence its movements. The BPSPX, however, focuses on the health of individual stocks within the index by measuring the percentage of stocks on Point & Figure buy signals. This binary approach (buy or sell) filters out minor price fluctuations and highlights significant trend reversals.

30-Year Analysis of the BPSPX

Using data from StockCharts.com, the BPSPX was analyzed over the past 30 years to identify key occurrences and their implications for the S&P 500 Index. The analysis focused on various thresholds:

• BPSPX crosses under 70 (BPSPX70)
• BPSPX crosses under 50 (BPSPXU50)
• BPSPX crosses over 30 (BPSPX30)
• BPSPX crosses over 50 (BPSPXO50)

Performance of BPSPX Signals

The BPSPX30 signal is particularly noteworthy, showing an 81.58% probability of positive returns over 9 months. Conversely, the BPSPX70 signal indicates a 43.53% probability of negative returns over 15 days, but with a modest median loss of -2.15%. The BPSPXU50 signal, while slightly less probable, suggests more significant losses when market breadth deteriorates.

Summary of BPSPX Signal Performance

Event	Outcome Type	Timeframe	Highest Probability (%)	Median Return (%)
Cross Above 30	Positive	9M	81.58	13.01
Cross Above 50	Positive	12M	69.00	19.95
Cross Below 70	Negative	15D	43.53	-2.15
Cross Below 50	Negative	10D / 15D	43.27	-3.21 / -3.59

Conclusion

The BPSPX serves as a valuable tool for identifying potential turning points in the S&P 500 Index. Bullish signals, particularly those crossing above 30, have historically provided reliable upside potential, while bearish signals below 50 indicate significant downside risks. This analysis emphasizes the importance of market breadth in understanding the underlying health of the market, making the BPSPX a critical indicator for investors and traders alike.

About the Author

Cedric Thompson, CMT, CFA, is an investment strategist with extensive experience in asset management, corporate strategy, and multi-asset investing.