A rare signal of a stock market collapse, which preceded several major declines, has been triggered on the S&P 500 index.
The Hindenburg Omen market breadth indicator, designed to identify internal weakness while stock prices are rising, has been triggered 13 times in the past three months.
This refers to a technical indicator that aims to identify periods when a large number of stocks simultaneously reach new 52-week highs and new 52-week lows, while the overall market remains in an uptrend.
Such conditions can signal market fragmentation lurking beneath the surface, where a handful of large companies continue to push the indices upward while weakness spreads to other segments.
Analysis of the indicator shows that throughout the history of the S&P 500, there have been only three recorded instances of the Hindenburg Omen triggering within a three-month period.
The first such case occurred in January 1980. Over the following year, the index fell by 13.4%, with a maximum drawdown reaching 14.8%.
The second case occurred in September 2018. The market remained resilient then, but over the next year, the S&P 500 index experienced a maximum drawdown of 13.1%. The most recent signal was recorded on August 1, 2026.
Even with a small sample size, statistics show that periods marked by unusually high concentrations of Hindenburg Omen signals have often been accompanied by increased volatility and significant market pullbacks. However, the indicator does have a history of false positives.
Currently, the market situation is ambiguous: the S&P 500 index continued to set new highs in 2026, with some analysts forecasting a record level above 8000 by year-end, driven by strong earnings from technology companies.
However, market concentration remains high, with technology and communication services accounting for a significant portion of the index.
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