Technical Market View

The S&P 500 (SPX) posted its first weekly loss in a month as investors prepare for tighter monetary policy from the Fed. We pulled back just above the 38.2% Fibonacci retracement of the run from the February lows while the 21- and 55-EMA were both support. We’re forming a bullish wedge/ channel pullback as well above the prior breakout zone while momentum is resetting with RSI back to 50 and MACD crossing over bearish and slowing.  A pop above the 8-EMA is in focus at 4515 which has upside to 4550 and then the 4600 level which positions just below a larger timeframe breakout. Support below at 4400 aligns with the multi-week base breakout while 4360 is also notable.

Market Sentiment/Breadth

AAII Sentiment for the week ending 4/6 showed a dip in bullish responses to 24.7% from 31.9% while bears increased to 41.4% from 27.5%. Neutral sentiment fell to 33.9% from 40.6%. Both optimism and pessimism reverting back to their relative extremes. NAAIM Exposure rose to 83.41 and well off the oversold extreme from early March. Lipper Fund flows had a small $253M in outflows from equities. As of Friday’s close, there were 251 new highs versus 520 new lows, weak breadth. The percentage of stock above their 50-day MA was 42.3% while those above their 200-day was 30.1%, weakening. NYSI fell this week to -111 and remains above its 8-EMA, although potential for a negative crossover this week. NASI also pulled back from its recent run and nearing a bearish cross. Cumulative AD faded from its recent run higher in a sign of weakness. NYMO was -14.5 and remains in a neutral spot. CNN Fear and Greed was 46, Neutral, and up slightly from 45 last week.