Here are the most recent market indicators:
S&P 500 is nearly even with its 200-day moving average = Neutral
S&P 500 is above its 50-day moving average = Bullish
S&P 500 one-month trend = Uptrend (Bullish) but Stalled (Neutral)
RSI: (S&P 500) @49.35 = Neutral
MACD: Above zero line but below its signal line (Neutral)
Daily Intraday Volatility: Moderate
Comment: Last week the market finally hit resistance and pulled back. On Friday, the jobs numbers (20,000 new jobs vs 180,000 expected) was horrendous. In a “normal” market, the indexes would have plunged. Although there was a minor pullback at the Friday open, the indexes ended flat thanks to help from the algos, who once again saved the day. (It’s not easy going short in this environment!). Nevertheless, it was a negative week for the indexes.
This week should be interesting. On Sunday night, the indexes are slightly lower. Nevertheless, we will have to see if SPX (S&P 500) can pick itself from the basement (it has retreated back to it’s 200-day moving average) and rally in spite of all of the bad news swirling around.
On the other hand, this market is still overbought so a major plunge in the indexes would not be surprising. Because the Fed, the White House, and the go-go algos all want the market to go higher, it’s not easy to short aggressively. However, if the indexes fail to move above and stay above its 200-day moving average, a pullback is very possible, even a severe one.
Bottom line: Keep your powder dry as this market could go in either direction. Buyers are still on the sidelines (except for the algos). This standoff will be resolved one way or another, and until then, trade cautiously and take profits quickly.
For daily results of multiple indicators, read Yardeni Research: https://goo.gl/eT3fzA
For insightful analysis of the stock market, read Lance Roberts:www.realinvestmentadvice.com
For insightful analysis of economic conditions, read Wolf Richter:www.wolfstreet.com