Charting the S&P 500: Uphill Battle Remains for the Index
When the bar is raised it is difficult to climb at the same rate of speed. You need to turn on the afterburners and push. The mountain gets very steep when the peak is in sight. The bulls see the all-time highs very clearly but just cannot muster the energy to get the push they need.
Maybe it was about the summertime, when market complacency is often high (as it is now). Without much to drive markets higher other than a rate cut (that’s not going happen!), there is room for a corrective move. We are not talking drastic here, the economy is strong, jobs are plentiful (Friday’s report was very positive) and earnings are robust, but inflation is still a problem.
The weekly chart shows a mild pullback happening, with more lower highs and lower lows but a very narrow range. Stochastics are falling and the MACD is on a sell signal.
Money flow remains positive but is coming down. The candles are blue so that is bullish, but a test of the 20-day moving average and failure would be very negative.
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