Weekly Market View 10-17-21
The S&P (SPX) had its best week since July after pulling back to its monthly value low and rebounding. Short-term momentum is clearly behind the bulls after we cleanly broke back above the 8-, 21- and 55-EMA late in the week for the first time since early September. We also broke out of a downtrend 9/7 highs; ultimately, a lot of the short-term hurdles for the bulls were broken last week. MACD had a bullish cross late in the week and RSI is also back above 55, so ‘ready to run.’ Resistance above of note include monthly value high at 4482.50, 4509.25 and recent highs at 4548. The current range has a measured target of 4644. Major support is down at 4400 which is the confluence of moving averages and the low-end of the Ichimoku cloud. Another notable area of interest below is the 4420-4429 zone.
AAII sentiment for the week ending 10/13 showed a surge in bullish responses to 37.9% from 25.5%. Bearish sentiment fell to 31.8% from 36.8% and neutral sentiment fell to 30.3% from 37.7%. NAAIM Exposure fell modestly to 64.46, around an area where we typically see it turn back higher. Lipper Fund flows had $1.7B of inflows to equities, the second straight week of positive flows. As of Friday’s close, there were 471 new highs vs just 93 new lows, strong overall breadth. The percentage of stocks above their 50-day MA was 51.9% while those above their 200-day was 52.8%, both continuing to improve. NYSI with a strong move higher and now well above its 8-EMA for the first time since June. NASI also broke above its 8-EMA late in the week too. CBOE Equity P/C 50-day MA fell to 0.496. Cumulative AD jumped back near the highest levels of the year. NYMO rose to 47.53 this week, highest level since February. CNN Fear and Greed rose to 51 from 34