Did Triple Witching Paint A Misleading Picture?

With last week's big move following the impressive start to the new month, this particular June is shaping up to be a record-breaker. Yet, that factoid is suspicious in and of itself, even if the current month had the advantage of starting out following a particularly bearish May (which followed an unusually bullish April).

Given the pattern - and the fact that the rally somehow stalled right at the previous record-breaking peak in late April - it would be unwise to not at least consider the possibility of a pullback taking shape here. Other clues are saying the same. On the other hand, even a pullback from here wouldn't necessarily snap all the potential support areas that could keep the market propped up.

We'll take a detailed look below, as always, after running down last week's major economic news and previewing this week's announcements.

Economic Data Analysis

Although it didn't seem like it, there was more economic news last week than just the Federal Reserve's decision to hold interest rates steady. Of course, that was still the biggest news - the Fed is content with the way things are, and thinks it will be through the rest of the year. That was a tacit vote of confidence in the status quo at a time when not everyone is convinced the economy is as healthy as it needs to be.

Nevertheless, there were other data nuggets released last week. It was a particularly big week for real estate, with last month's housing starts and building permits being posted on Tuesday, and May's existing-home sales figures released on Friday.

Starts and permits were... reasonable, more or less in line with estimates, and more or less in line with April's levels. It's not the forward progress we'd like to see, but stability is enough for now when considered in conjunction with other real estate data.

Housing Starts and Building Permits Charts

Source: Thomson Reuters

That 'other real estate data' includes existing-home sales, of course, which were up a bit, and a bit better than expected. Last month's report was a step forward, but more than that, it further gels a turnaround effort that new-home sales have already pointed to.

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