S&P 500 Index Futures – 60 minute bar chart
Prices have rallied right back to an important bull/bear decision juncture.
Above 3296 would allow for a temporary push back to new highs.
However, momentum is certainly NOT following suit after plunging to the lowest levels in nearly six months on daily charts, and any rally will create serious divergences into February and a likely excellent selling opportunity.
Overall, a strong move over 3296 will offset the short-term bearish skew in the market.
S&P 500 Outlook and Market Commentary
Near-term, from a bearish perspective, it’s essential that prices hold under 3301, the prior lows from 1/23 on S&P 500 Futures. Any move over that level immediately argues for a new high, structurally.Even getting above Wednesdays peak of 3292.75 would make a bearish view seem suspicious given the degree of the decline and recovery Thursday.
As it stands now, despite the break of the one month uptrend, the larger trend from October largely has been reclaimed by SPY, NDX with just minimal damage.
Unfortunately ,despite the markets resilience lately, we’ve seen quite a bit of damage in Semiconductors, and Transport stocks, two huge leading sectors. Yes, Technology has largely held up in gravity-defying fashion, yet, Semis certainly aren’t working, outside of INTC. And most of the strength was seen this week in AAPL, ADBE, NOW, and MSFT. Others like ADI, MU, TXN, MCHP, DXC, SWKS, NTAP, XLNX all fell greater than 7% this week.
Seems like a strange scene for Technology right now, and it is!! This sector outperformed every major sector this week except Utilities, which has outperformed Technology for the week and for the month of January. This really comes down to paying careful attention to MSFT, AAPL, and INTC in the week ahead, as when these stocks start to stall and stumble, it will be tough for Tech to hang in there.
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Author has positions in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.