score slips to 29 as oil eases and recession odds fall
By Alex · Doom Watcher analyst
The Doom Score fell one point to 29, crossing back into All Clear from Caution, as Energy Price Shock continued to improve and prediction markets trimmed 2026 recession odds by 2.5 points on both platforms. Consumer Confidence and housing supply remain the dominant stress contributors.
By the Numbers
The Doom Score closed at 29, down one point from 30 and below both the 7-day average of 30.6 and the 30-day average of 32.5. The move crosses the threshold from Caution into All Clear. Core 6 sub-score prints at 21.69 — notably low, indicating that the six most-weighted indicators are collectively generating modest stress. Diffusion Index sits at 41.18, meaning fewer than half of tracked indicators are deteriorating on a 90-day basis. Top drivers by weighted contribution are Consumer Confidence, Energy Price Shock, Home Construction, Months Supply of Houses, and Unemployment Pace. Consumer Confidence leads at 125% activation — the only indicator fully saturated — while Energy Price Shock at 88.9% and Months Supply of Houses at 100% keep the housing and energy channels elevated despite improving trends.
What Changed Today
The one-point decline was driven primarily by continued improvement in Energy Price Shock, which sits at 88.9% activation with an improving trend, down from higher recent readings. Months Supply of Houses holds at 100% activation but its trend shifted to improving, reducing its marginal pressure. Trade Policy Uncertainty continued its improving trajectory, now at 31.4% activation. On the deteriorating side, Consumer Confidence remains fully activated at 125% with a worsening trend, and Real Income, JOLTS Quits Rate, Personal Savings Rate, and Debt Service Ratio all carry worsening trends — a cluster of household-financial-stress signals that prevents a sharper score decline. No indicator flipped a critical threshold today. Weekly Layoff Filings holds at 207,500 with zero activation and an improving trend, keeping the labor channel quiet.
News Drivers
The dominant macro story is the reported US-Iran peace negotiation, which is pulling oil prices lower — directly feeding the improving trend in Energy Price Shock. Gold at $4,750 per ounce and a stronger Indian rupee reflect the safe-haven unwind that typically accompanies de-escalation in a commodity-linked conflict. That dynamic is the clearest single-day driver of the score's improvement. Offsetting it, China's reported pause on new loans to US-sanctioned refiners introduces a supply-side complication that could limit how far energy stress retreats. Equity markets hitting record highs on AMD earnings and AI momentum supports the zero-activation readings in Financial Conditions and VIX. Prediction markets moved meaningfully: Polymarket's 2026 recession contract fell from 25% to 22.5%; Kalshi from 25% to 20%. Both platforms are now pricing materially lower recession risk than a week ago.
Historical Context
At 29, the score sits one point below the 7-day average of 30.6 and 3.5 points below the 30-day average of 32.5, suggesting a modest but consistent easing trend over the past month. The 90-day maximum of 38 — reached during a period of sharper tariff and credit stress — now sits nine points above today's reading, indicating meaningful distance from recent peak anxiety. All Clear readings in the high-20s are consistent with soft-patch episodes where macro stress is real but not self-reinforcing. The current configuration — consumer confidence deeply stressed while financial conditions, credit spreads, and labor filings remain clean — resembles the 2015-to-2016 window, when sentiment indicators led the composite higher while hard data stayed resilient for several additional quarters.
What to Watch
The next material catalyst is Thursday's Weekly Layoff Filings print. At 207,500 with zero activation, claims would need to rise toward 230,000 to begin registering stress. Consumer Confidence at 53.3 and 125% activation is the score's most saturated indicator; a further decline in the Conference Board or Michigan reading would deepen its contribution. Energy Price Shock at 88.9% activation is the indicator most likely to flip downward if the Iran deal progresses — a sustained oil price decline toward $65 WTI could reduce its activation materially and shave another point or two from the composite. On the housing side, Months Supply of Houses at 9.7 months remains elevated; a reading below 8.5 would begin to ease that channel. The Yield Curve at 0.5 carries zero activation and a stable trend — no near-term threshold risk there.