Rightful Caution Into Powell
S&P 500 was rejected above Fri highs, at 5,155, amid Nasdaq not regaining traction – tilting the overnight odds a bit bearish way. The positioning for Powell testimony and JOLTS that would in my view come easily at or above 9M thereby dialing back soft landing odds, is to be bearish during today‘s session no matter how well DAX is doing.
Is that the end of the upleg? No, it‘s very well earnings and breadth supported – we‘re only making a local high following the bullish flag breakout to the upside. Very short-term momentum is with the bears, but medium-term one remains with the bulls, and the only question is just how shallow a correction we get, whether that would be two or three dozen points from the top, or a double of that.
Let‘s move right into the charts (all courtesy of www.stockcharts.com).
S&P 500 and Nasdaq Outlook
Sectoral oddities such as XLK diverging from XLY and XLC together with XLU rising, smack of short-term trouble when I expect Powell to play the data dependency caution no rush to cut card tomorrow.
More By This Author:
Soft Landing SqueezingSoft Landing Charm
Inflation Surprise
Subscribe to Monica‘s Insider Club for trade calls and intraday updates. more
Comments
