S&P 500 is above its 200-day moving average = Bullish
S&P 500 spurted above its 50-day MA last week on low volume = Neutral
S&P 500 one-month trend: SPX uptrend is still broken but indexes are making a run for all-time highs at SPX 3000.
RSI: (S&P 500) @ 58.33 = Slightly Overbought
MACD: Slightly Above Zero Line and strongly above Signal Line = Neutral
Daily Intraday Volatility: 15.03 = Neutral. Volatility is on the low side.
Comment: After a poor start early in the week, the algos got their mojo back and ran the market higher on low volume, bringing the SPX back above its 50-day moving average. We are very close to our all-time highs so it’s going to get interesting. In addition, the Fed will have their FOMC meeting in a week (Sept. 17 and 18), which almost always attracts volatility. Soon we will learn whether the latest rally to all-time highs is the real deal or a head fake. Everyone will be listening closely to the Fed chairman’s words.
There are signs of a slowdown in manufacturing, car sales, and house sales, and yet the market moves higher. Volatility has been suppressed and most investors are complacent about the market (“It goes up and down, what can you do?”).
I’m taking a wait-and-see approach as the market is rallying on light volume and numerous warning signs. With the Fed ready to speak about lowering interest rates, if they please Wall Street, the market could rally to SPX 3000. If the Fed disappoints, then we could fall to SPX 2800 or lower.
Bottom line: It’s all about the Fed for the next two weeks, so be cautious. It’s not a bad time to increase cash during these turbulent times (it doesn’t mean sell everything), or to diversify into less-risky investments.
For a more detailed analysis of technical and economic indicators, I will refer you below to two excellent columns from market technician Sven Henrich (Northman Trader), and money manager Lance Roberts (realinvestmentadvice.com). Both are excellent reads.
Northman Trader: https://bit.ly/2k6BSjk
Lance Roberts: https://bit.ly/2lFvVdA
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