Technical Market Report For March 7, 2026

The good news is:

• New lows have not been expanding during the recent price decline.

The Negatives

The first chart covers the last 6 months showing the Nasdaq composite (OTC) in blue and a 10% trend (19 day EMA) of Nasdaq new highs (OTC NH) in green.  Dashed vertical lines have been drawn on the 1st trading day of each month.  

OTC NH continued its fall last week.

The next chart is similar to the one above except it shows the S&P 500 (SPX) in red and NY NH in green has been calculated with NYSE data.  

NY NH also continued falling. 

The next chart covers the past 6 months showing the OTC in blue and a 40% trend (4 day EMA) of Nasdaq new highs divided by new highs + new lows (OTC HL Ratio), in red.  Dashed horizontal lines have been drawn at 10% levels for the indicator; the line is solid at the 50%, neutral level (equal numbers of new highs and new lows). 

OTC HL Ratio fell below the neutral line last week. 

The Positives

The next chart is similar to the one above except it shows the SPX in red and NY HL ratio, in blue, has been calculated with NYSE data.

NY HL Ratio fell, but remained above the neutral line.

The next chart covers the past 6 months showing the OTC in blue and a 10% trend (19 day EMA) of Nasdaq new lows (OTC NL) in brown.  OTC NL has been plotted on an inverted Y axis so decreasing numbers of new lows move the indicator upward (up is good).  

OTC NL continued moving upward last week.

The next chart is similar to the one above except it shows the SPX in red and NY NL, in blue, has been calculated with NYSE data.

NY NL also moved upward while prices were falling.

Seasonality

Next week includes the 5 trading days prior to the 2nd Friday of March during the 2nd year of the Presidential Cycle.  The tables below show the daily change, on a percentage basis, for that period.  

OTC data covers the period from 1963 to 2025 while SPX data runs from 1953 to 2025.  There are summaries for both the 2nd year of the Presidential Cycle and all years combined.  Prior to 1953 the market traded 6 days a week so that data has been ignored.

Seasonality for the coming week has been modestly positive by all measures.

Report for the week before the 2nd Friday of March.

The number following the year is the position in the Presidential Cycle.

Daily returns from Monday to 2nd Friday.

OTC Presidential Year 2 (PY2)

 Year       Mon     Tue     Wed    Thur    Fri    Totals

 1966-2  -0.72%  -1.43%  -1.03%   0.57%  -0.39%  -3.00%

 1970-2  -0.22%  -0.50%  -0.02%  -0.35%  -0.93%  -2.02%

 1974-2  -0.27%   0.97%   0.43%  -0.62%   0.68%   1.19%

 1978-2  -0.21%   0.28%   0.38%   0.40%   0.58%   1.44%

 1982-2  -1.69%  -0.77%   0.42%  -0.19%  -1.09%  -3.33%

 Avg     -0.62%  -0.29%   0.04%  -0.04%  -0.23%  -1.14%

 1986-2   0.47%   0.94%   0.63%   0.18%   0.40%   2.62%

 1990-2  -0.20%   0.51%   0.03%   0.93%   0.06%   1.33%

 1994-2   0.57%  -0.37%   0.12%  -0.50%   0.01%  -0.17%

 1998-2  -1.61%   1.35%   0.47%   0.42%   0.43%   1.06%

 2002-2   3.14%   0.37%   1.29%  -0.46%   2.55%   6.89%

 Avg      0.47%   0.56%   0.51%   0.11%   0.69%   2.35%

 2006-2  -0.72%  -0.77%  -0.04%  -0.78%   0.55%  -1.77%

 2010-2   0.25%   0.36%   0.78%   0.40%  -0.03%   1.76%

 2014-2  -0.04%  -0.63%   0.37%  -1.46%  -0.35%  -2.10%

 2018-2   1.00%   0.56%   0.33%   0.42%   1.78%   4.10%

 2022-2  -3.62%  -0.28%   3.59%  -0.95%  -2.18%  -3.43%

 Avg     -0.63%  -0.15%   1.01%  -0.47%  -0.05%  -0.29%

OTC summary for PY2 1966 - 2022 

 Avg     -0.26%   0.04%   0.52%  -0.13%   0.14%   0.30%

 Win%       33%     53%     80%     47%     60%     53%

OTC summary for all years 1963 - 2025

 Avg     -0.32%   0.36%   0.04%   0.09%   0.09%   0.25%

 Win%       41%     53%     62%     62%     51%     62%

SPX PY2

 Year       Mon     Tue     Wed    Thur    Fri    Totals

 1954-2  -0.26%   0.23%   0.23%   0.45%   0.00%   0.64%

 1958-2   0.33%   0.71%  -0.24%   0.12%  -0.31%   0.62%

 1962-2  -0.21%  -0.33%  -0.13%   0.72%   0.33%   0.37%

 1966-2  -1.34%   0.16%   0.88%   0.00%  -0.12%  -0.42%

 1970-2  -1.04%   0.27%  -0.07%  -0.41%  -0.53%  -1.77%

 1974-2   0.00%   1.87%   0.68%  -1.06%   0.87%   2.36%

 1978-2  -0.63%   0.53%   0.55%   0.06%   1.13%   1.63%

 1982-2  -1.83%   1.39%   0.53%  -0.05%  -0.69%  -0.64%

 Avg     -1.21%   0.84%   0.52%  -0.36%   0.13%   0.23%

 1986-2   0.45%   2.26%   0.37%   0.28%   1.44%   4.79%

 1990-2  -0.54%   1.26%  -0.29%   0.99%  -0.69%   0.73%

 1994-2   0.47%  -0.22%   0.25%  -0.68%   0.55%   0.37%

 1998-2  -0.32%   1.13%   0.40%   0.13%  -0.12%   1.22%

 2002-2   1.95%  -0.67%   1.45%  -0.45%   0.58%   2.87%

 Avg      0.40%   0.75%   0.44%   0.05%   0.35%   2.00%

 2006-2  -0.70%  -0.19%   0.20%  -0.49%   0.73%  -0.43%

 2010-2  -0.02%   0.17%   0.45%   0.40%  -0.02%   0.99%

 2014-2  -0.05%  -0.51%   0.03%  -1.17%  -0.28%  -1.98%

 2018-2   1.10%   0.26%  -0.05%   0.45%   1.74%   3.50%

 2022-2  -2.95%  -0.72%   2.57%  -0.43%  -1.30%  -2.83%

 Avg     -0.52%  -0.20%   0.64%  -0.25%   0.17%  -0.15%

SPX summary for PY2 1954 - 2022 

 Avg     -0.33%   0.42%   0.44%  -0.07%   0.19%   0.67%

 Win%       29%     67%     72%     53%     47%     67%

SPX summary for all years 1953 - 2025

 Avg     -0.22%   0.20%   0.03%   0.00%   0.11%   0.12%

 Win%       49%     52%     56%     60%     47%     55%

Conclusion

At least some market participants are uneasy with the new war, but not all.

There was no volume spike as prices declined and new lows declined, albeit modestly.

On average, war has been good for the market.

Seasonally, on average, the market has peaked in late April during the 2nd year of the Presidential cycle; a short term rally in the next 2 months would be within the average PY2 pattern.

The strongest sectors last week were Energy and Internet while the weakest were Electronics and Banks (for the 2nd week in a row).

I expect the major averages to be lower on Friday March 13 than they were on Friday March 6.

Last week's positive forecast was a miss.