Short-term trend (DAILY CHART) – BULLISH: SPX rallied fairly strongly last week, rising from 4358 to 4415, a 57-point rally. After the astounding 241-point rally of two weeks ago, you should not be surprised that SPX is above its three major moving averages (although only slightly above the 100-day). Note: Futures are FLAT on Monday morning.

Long-term trend (WEEKLY CHART) – BULLISH: SPX is strongly above all three major moving averages and pointing in the right direction (up).

MACD (DAILY) = MOVING HIGHER. MACD is pointing in the right direction (up). It is above the 9-day signal line and almost clear of the zero line. A few more bullish days and MACD should give an all clear signal.

RSI: (S&P 500) = 61.76 (DAILY) SLIGHTLY OVERBOUGHT. RSI is slightly overbought but not at extreme levels (yet).

Comment: It was another bullish week for the indexes, perhaps because interest rates fell so dramatically. On the other hand, Moody's downgraded the U.S. outlook, which should negatively impact the stock market. In addition, there is another threat of a government shutdown, but typically this is resolved at the last minute.

There is a lot of talk about a potential recession in 2024, but no one but fortunetellers can see the future. One potential scenario is a strong rally for the next few months and a strong pullback in 2024. This is just a guess, however.

After that two-week rally (a blow-your-socks-off rally), it would not surprising to see the market catch its breath this week.