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Take-Aways:

The bears made their case a bit stronger last week as the major U.S. averages closed below important support levels as well as their key moving averages. Global stocks gave investors a similar view. At the same time, the 10-Year note remains under pressure, notching its lowest weekly close of the current bearish trend, and continues to be an “unsafe” haven. Commodities also bowed to bearish pressure, closing below the 10 and 40-week moving averages to put important support levels into play.  

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U.S. Equities

The S&P 500 closed the week below the closely watched support level at 3,900 as well as the 10 and 40-week moving averages. These dynamics put the index into a defensive posture despite the 14-week RSI holding above 40. Investors should be open to the idea that the June lows could be tested. Bulls may be better served to wait for signs of a durable reversal before becoming more aggressive.

The S&P Small Cap 600 Index also closed below price-based resistance at 1,200 and the 10 and 40-week moving averages. This keeps a bearish bias to the trend even as the 14-week RSI is above the 40-level. The June lows remain in play for Small Caps.

The relative trend remains neutral, below price-based resistance.

The NASDAQ 100 Index closed lower on the week, moving below the key 12,000 level while remaining below the 10 and 40-week moving averages. Given these dynamics, it is hard to make a bullish case on this group despite the 14-week RSI holding above 40. Here too, the door remains open for the June lows to be tested.

The relative trend continues to trade below resistance and is heading lower. Odds favor continued underperformance.

U.S. Fixed Income

The 10-Year Note marked its lowest weekly close of the downtrend that began in late 2020. The Note remains below the 2018 lows and the 10 and 40-week moving averages, keeping the bears in control of the trend.

The yield remains above resistance at the 3.20% level, increasing the odds of a move toward 4.00%.

Global Equities

The Global Dow is beginning to break price-based support below the 10 and 40-week moving averages. The 14-week RSI is also pushing below 40, indicating that momentum is still in favor of the bearish price trend.

The relative trend remains under pressure, near the late 2021 lows, despite some outperformance last week.

Commodities

The Bloomberg Commodity Index closed below the 10 and 40-week moving averages last week, putting the support zone between 106 and 110 in play on the downside. The 14-week RSI is holding above 40, but bulls want to see the index back above the moving averages before becoming more aggressive. A close below 106 would indicate that the bears have taken control of the trend.

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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.