The U.S. market remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq gapped up for a third straight session and are now trading within a range of resistance dating back to October 2018. The S&P 500 briefly cleared above the 2,800 to 2,815 (November 2018 high) level before closing mid-range on the session, while the Nasdaq cleared above 7,670 (October 2018 high) before also closing mid-range on the session.
Symbol: Charts
WON Global View
An 18% rally on the DJIA since December lows, with no 5% pullback, is higher than the 14% average (11% median) leg in a bull market, dating back to 1900. One leg is a 5%+ move in either direction.
A leg of 15% gain immediately following a 15% loss is very rare, occurring only four times prior to the current leg. A ~6% pullback is typical following these v-shaped recoveries.
Earnings estimates continue to come down, with GAAP S&P 500 earnings now expected to decline 2% in Q1 2019.
While the seasonal setup remains strong (Q1 in the third year of a presidency and strong January gains), macro uncertainty combined with the above average rally from lows could soon test our current bullish stance.
WON Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 cleared above its 200-DMA, while the Nasdaq touched that level and then reversed to close at the lows of the session, albeit in light volume. Look for the major averages to avoid distribution and for leading ideas to hold above individual support levels should the major averages pull back off current levels.
WON Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq declined ~1% on volume greater than the prior day as each index picked up a distribution day in the process. Despite the sell-off, the majority of leading stocks pulled back in constructive fashion. To maintain a positive outlook, indices need to avoid a clustering of distribution days. Currently, the distribution day count remains low with only two days on the S&P 500 and one on the Nasdaq.
WON Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq pulled back off on below average volume and thus avoided a distribution day. Indices continue to face resistance along the 200-DMA, however, price action remains constructive.
WON Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq pulled back to their respective 50-DMA for a second straight session but were again able to hold support and avoid distribution. Look for the indices to continue avoiding distribution and preferably stay above 50-DMA support should we see further consolidation.
WON Global View
The U.S. market is in a Confirmed Uptrend. The Nasdaq closed above its 50-DMA (6,997) for the first time since October. We will now be looking for this level to act as support should the market pull back. The S&P 500 continues to make good progress since the January 4 follow-through day but remains 80bps below its 50-DMA (2,631). Overall, action remains constructive, with just one distribution day on the S&P 500.
WON Global View
The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq continue to consolidate constructively below resistance along their respective 50-DMA (S&P 500: 2,633 (+1.9%); Nasdaq: 7,002 (+1.4%)). Though volume came in below average, the S&P 500 did pick up its first distribution day since the January 4 follow-through day. To stay constructive, the market needs to avoid any major price break that closes at the lows of the session in heavy volume. We believe tight sideways consolidation will set up the market for a move up and through its 50-DMA.
