5 Bullish Stock Market Signals Suggest the Tariff Sell-Off Is Over

By: Sayan

Published on: Apr 26, 2025

Stock Market Rally: Is the Tariff Sell-Off Over?

After weeks of intense volatility, the stock market has surged, with the S&P 500 gaining 13% since the U.S. government announced a 90-day tariff pause. Nearly 10% of that rally came in a single day, leaving investors wondering:

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  Is this just a bear market bounce, or the start of a lasting recovery?

  
  


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  Are new all-time highs ahead, or will stocks retreat again?

  
  

Analysts believe the bull market remains intact, with multiple technical indicators flashing strong buy signals. Here are the five most bullish signs suggesting the worst may be over.

1. The Rare Zweig Breadth Thrust Signal

One of the most reliable bullish indicators in market history—the Zweig Breadth Thrust—flashed on April 25, 2025.

Why It Matters:

• Only 18 occurrences since 1945 (last seen in November 2023).


• Historically, the S&P 500 gains an average of 15.3% in six months and 24% in 12 months after this signal.


• Indicates broad market participation, not just a few big stocks rallying.

2. The VIX Collapse: A "Bear Killer" Signal

The Cboe Volatility Index (VIX), Wall Street’s "fear gauge," recently triggered a rare "bear killer" signal.

What Happened:

• The VIX spiked above 50, then plunged below 30 in just two weeks.


• Historically, this leads to:


• Median 11% gain in six months


• 17.9% gain in 12 months (100% positive return rate)

3. The Death Cross Reversal: A Contrarian Buy Signal

A "death cross" (when the 50-day moving average crosses below the 200-day MA) is typically seen as bearish—but not this time.

Key Insight:

• The S&P 500’s death cross on April 14, 2025, came within a month of a 19% drop.


• Historically, similar setups led to:


• Average 16% returns in 12 months


• 83% win rate

4. High-Yield Bond Spreads Narrowing (Recession Fears Easing)

High-yield bond spreads (the extra yield investors demand for riskier debt) have tightened significantly, suggesting recession risks are fading.

The Data:

The BofA US High Yield Spread fell from 4.61% to 3.75% in April.

Indicates growing confidence in corporate credit.

5. Back-to-Back 90% Advancing Days (Strong Breadth)

• On April 22, 2025, the market saw two straight days where 90% of stocks rose—a rare sign of broad-based strength.


• Historical Precedent:


• Previous occurrences (March 2009, August 2011, April 2020) all marked major market bottoms.


• Suggests this rally has strong participation, not just a few mega-cap stocks lifting indices.

Bottom Line: Is the Stock Market Recovery Real?

• With multiple bullish signals aligning—including rare breadth thrusts, volatility crashes, and bond market improvements—the evidence suggests:


• ✅ The worst of the tariff sell-off is likely over.
  ✅ The bull market remains intact.
  ✅ Forward returns historically favor buyers at these levels.


• While risks remain (geopolitical tensions, Fed policy), the technical picture is the most bullish it’s been in months.