Key Points
- The S&P 500 Retakes the 40-Week Moving Average
- Small Caps Hit a Resistance Point
- The NASDAQ 100 Moves into a Neutral Stance
- Ten Year Note Remains in Freefall
- Global Dow Sets Its Sights on the January Highs
U.S. Equities
The S&P 500 closed higher for a second consecutive week and reclaimed the 40-week moving average in the process. The index is now set to do battle with resistance in the 4,500 – 4,550 zone. Breaking above this mark could tilt the advantage in favor of the bulls and set the stage for an attack on the January highs.
The 14-week RSI is moving higher after regaining the 40-level in the prior week.
The S&P Small Cap 600 ticked down on the week after meeting resistance at the 40-week moving average. The index is above the 10-week moving average, keeping the trend neutral for now. Support remains near 1,220; retaking the 40-week moving average would put the bulls in control of the trend.
Relative to the S&P 500, Small Caps have moved into a neutral position after losing ground to the S&P 500 for a second consecutive week.
The NASDAQ 100 Index was higher last week, building on the strength that was exhibited in the prior week. Thus far, the two-week rally has served to put the index into a neutral position, between the 10 and 40-week moving averages. The 13,000-14,000 area serves as a support zone, but it will take a break from the 15,500 level to make the case that the bulls are taking control.
The relative trend also improved last week but still has work to do before a high conviction bullish case can be made.
U.S. Fixed Income
The 10-Year Note remains under intense pressure, extending its decline below the 10 and 40-week moving averages. Support comes into play in the $118-$120 zone.
The yield has made a powerful move to the upside and now appears to have running room toward 3%.
Global Equities
The Global Dow moved higher for a second week in a row to reclaim the 10 and 40-week moving averages. Above 4,000, there is scope for a run to the January highs.
The relative trend remains below resistance. Until there is a clean break from the current consolidation, it is hard to make a case for outperformance on the part of Global stocks vs. their U.S. peers.
Take-Aways
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