Equities in the U.S. remain under pressure as the S&P 500 has closed lower in the eight of the past nine weeks. On a relative basis, Small Caps are still the least bad while the NASDAQ 100 continues to lag. Bonds have reversed lows after a short-term bounce attempt as the bears are firmly in control of trends in the space. Commodities look to reassert their bullish trend, and a weakening dollar could provide a tailwind.

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U.S. Equities

The S&P 500 closed lower last week and remained below resistance near the 4,200 level. The index is still below the declining 10 and 40-week moving averages, with the former in line with price-based resistance. The 14-week RSI continues to make lower highs and trade in a bearish regime.

The S&P Small Cap 600 has moved through price-based resistance to test the declining 10-week moving average. This action plays out below the declining 40-week moving average. The 14-week RSI remains in a bearish regime.

We have been noting for the past few weeks that small caps have been resilient on a relative basis, which remains the case this week. The ratio moved higher once again. A break of the October/November peaks could set the stage for further outperformance.

The NASDAQ 100 Index maintains its bearish trend, below resistance and the declining 10 and 40-week moving averages. Momentum confirms the bearish trend, with the 14-week RSI continuing to make lower highs.

The relative trend also remains bearish as the ratio trades below broken support and has been making lower highs since the November peak.

U.S. Fixed Income

After a short-term rally from the 2018 lows, the 10-Year Note has come under renewed pressure. The note has met resistance at the declining 10-week moving average, which is below the declining 40-week moving average. A break of the $118 level could set the stage for further downside.

The yield moved higher last week but still has resistance to overcome near the 3.20% level.

Across the curve, yields are in consolidation mode after moving powerfully to the upside in 2022. Last week saw the rate move higher across the board. While there have been calls, of late, for a peak in rates, we are of the view that it is still too soon to make that call.

The iShares Core U.S. Aggregate Bond ETF (AGG) rallied back to resistance at the $104 level and promptly failed to break through. The fund remains below the declining 10 and 40-week moving averages, further supporting the bearish trend. The 14-week RSI remains oversold, lending momentum confirmation to the bearish price action.

Global Equities

The Global Dow has established support near the 3,600 level but remains below the declining 10 and 40-week moving averages. During the most recent low, the 14-week RSI did not reach an oversold position, but we note that the indicator is still in a bearish regime.  

The relative trend remains below resistance, but a breakout is still a threat. If it takes place, the stage could be set for further outperformance.


The Bloomberg Commodity Index remains in an uptrend, above the rising 10 and 40-week moving averages. The 10-week moving average continues to define the near-term trend. A break above the 1140 level could be a signal that the next leg of the bullish cycle is beginning.

The 14-week RSI is in an overbought position, confirming the bullish price action.

Across the commodity market, Energy continues to do much of the heavy lifting, breaking to a new high for the cycle last week. Profit-taking has found the Agriculture space, pushing the group below the breakout level and back into consolidation. Precious Metals remain unimpressive while Industrial Metals continue to break down.

U.S. Dollar

The Dollar has come under pressure, failing to hold above the breakout level at $103. As we noted two weeks ago, this weakness is likely a response to the 14-week RSI becoming extremely overbought. However, dollar bulls want to see $103 reclaimed. 

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Disclosure: This information is prepared for general information only and should not be considered as individual investment advice nor as a solicitation to buy or offer to sell any securities. This material does not constitute any representation as to the suitability or appropriateness of any investment advisory program or security. Please visit our FULL DISCLOSURE page.