Here are the latest indicators:
S&P 500 one-month trend = Bearish
S&P 500 is well below its 50-day moving average and slightly above its 100-day MA = Bearish
RSI: (S&P 500) @45.62 = Neutral
Intraday Volatility: Increasing
Daily results of multiple indicators (from Yardeni Research): https://goo.gl/eT3fzA
Comment: As expected, intraday volatility increased last week, providing opportunities for traders and anxiety for investors. Volatility should also increase this week as well due to trade wars talk, among other things (i.e. interest rates). With the S&P 500 well below its 50-day moving average and below the 2700 line in the sand, the bears are in control at the moment. However, the bulls will try and retake the 50-day moving average so be prepared for sudden rallies.
Predicting next week is a fool’s errand as the market will once again go in both directions. It’s important to recognize that the market is changing before our eyes. I am guessing that the bull market is slowly coming to an end but we need more evidence first. If my theory is correct, it will not be a pleasant experience for most people but there will be money-making opportunities if you are sharp, and paying attention. Try to keep an open mind, i.e. that the market can go in both directions. It might take a while for a long-term trend to take hold as the bulls and bears fight it out each day.
Bottom line: Trade small if are a new trader, and if you are an investor, have hedges in place in case of worst case scenarios. Let’s see if the bulls can ride the market back above SPX 2700.