The past week started well, and finished well into closing at historical highs for the S&P500. This is very different compare to achieving a historical high as closing at the high indicates the underlying momentum, strength and commitment in price action terms. And under these circumstances, when prices hit an all time high, they would continue to do so…. until they do not. Meanwhile, the technicals are pointing up. 👆
A look into the S&P500 weekly chart shows a solid bullish marubozu, albeit with very much lower volume. Putting aside that a FOMC decision would be made mid-week coming, and a small rate cut is expected by the markets, technicals indicate that the fire just started for the bull rally – again.
The high yield bonds are shouting a positive turn with the start of RISK ON. The technology sector (Nasdaq) similarly has a beautiful candlestick to show bullish strength as a leading sector. The Russell2000 small caps and the DJ Transports are about to breakout with the respective MACD crossing over into bullish territory.
The Value line is similarly turning bullish and would be looking for the last high to break resistance.
Overall, the market appears very bullish, albeit a little early, and pending the reception to the FOMC’s decision this Wednesday. The coming week will be technically critical to show the commitment or lack of in this imminent bull run.
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