The stock market, as measured by the S&P 500 Index
SPX,
+0.57%,
continues to struggle to make headway. The downtrend that began at the beginning of February is still in place. It is a series of lower highs and lower lows on the SPX chart, and the S&P 500 has repeatedly run into resistance at or below 4080. In fact, the entire area between 4080 and 4200 is a roadblock. On the downside, the S&P 500 has found support in the zone between 3760 and 3850. Overall, the SPX chart won’t turn bullish unless it can break out over at least 4200 and probably 4300 (the highs of August 2022).
Contrasting the price action of SPX is the fact that many of our firm’s internal indicators have given confirmed buy signals in the past few weeks. That is certainly positive, of course, but in the past there have been more than a few occasions where SPX doesn’t confirm what the internal indicators might be “saying.” In those cases, SPX wins out because price — by definition — is the final arbiter.
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