Key Points

  • The S&P 500 Closes Below Key Resistance
  • Small Caps Drop the Ball on a Relative Basis
  • The NASDAQ 100 Faces a Key Test This Week
  • The Ten-Year Note Moves Down from a Lower Low
  • Commodities Stage a Key Reversal

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U.S. Equities

Despite a rally last week, the S&P 500 remains below the key 3,900 – 4,000 zone. This area of resistance lines up with the declining 10-week moving average, which is below the declining 40-week moving average. At the same time, the 14-week RSI is holding in a bearish regime as it trades in a downtrend since peaking in November.

The S&P Small Cap 600 Index remains below resistance defined by the lower bound of the 2021 consolidation zone. The index is below the declining 10 and 40-week moving averages, and the 14-week RSI is holding in a bearish regime. 

After showing much promise, the relative trend has begun to stall below the key resistance points at the October/November highs. The group has gone from being “less bad’ than the S&P 500 to perform in line with the major U.S. average.

The NASDAQ 100 has staged a rally back to broken support and the declining 10-week moving average, setting the stage for this week to be a key inflection point. Strength from here puts the declining 40-week moving average into play on the upside. The 14-week RSI has turned higher but remains in a bearish regime.

The relative trend remains bearish as the ratio trades below broken support; however, there are some early signs of stabilization that have caught our attention.

U.S. Fixed Income

After a rally that once again caused early bottom callers to become more vocal, the 10-Year Note turned lower last week to close back below the declining 10-week moving average. The Note remains well below the declining 40-week moving average as it prepares to do battle with the 2018 level after making a lower low.

The yield is wrestling with resistance near 3.20%. This is arguably one of the most important charts in the market, and it will be in focus as the CPI report will be a key catalyst this week.

Global Equities

The Global Dow is below the key 3,600 level and the declining 10 and 40-week moving averages. This bearish price structure is confirmed by momentum as the 14-week RSI trades near oversold levels     

The relative trend remains below resistance, failing to breakout over the past few weeks.


The Bloomberg Commodity Index has sustained short-term damage that will likely serve to shake out the weak hands and those who were late to recognize the bullish trend. Price is below the 10-week moving average, which is now moving lower. However, last week saw the rising 40-week moving average act as support. The longer-term trend is still in favor of the bulls if price is above 105.

The 14-week RSI is holding in a bullish regime, testing the 40-level as the new week begins.


As the new week begins, it is hard to make a strong bullish case on risk assets. Equities are trading below key resistance levels and moving averages. Treasuries have turned lower, dealing another blow to bottom callers who refuse to wait for evidence of a sustainable turn. Commodities have also sustained damage, as nothing is immune in a bear market; however, bulls stepped up and defended the long-term trend ahead of this week’s CPI report. 

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