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Weekly Market View 10-24-21

Weekly Market View 10-24-21

by | Oct 24, 2021 | Weekly Market View

The S&P 500 (SPX) marched higher for the third straight week and made a new all-time weekly closing high at 4536.50 as earnings season kicked off and concerns around Washington and China abated. Friday’s candle ended a streak of seven straight sessions highs and now fairly extended above its short-term moving averages, setting up for a possible breather and consolidation phase. S&P futures broke out above monthly value on Tuesday at 4484 which now aligns with the rising 8-EMA, a logical spot to watch for a potential bounce. Other areas of note include VWAP from 10/13 at 4464.25 and then the monthly POC is down around the 21-EMA at 4436.50. A breakout above 4550 in the futures has no resistance as we’re at all-time highs. The multi-week range from the September pullback measures out to 4840. Ahead of that level are some key Fibonacci extensions at 4621.50, 4664.75 and then 4700.

Market Sentiment/Breadth

Sentiment overall surged to the bullish side of the ledger this week. The latest AAII sentiment survey for the week ending 10/20 showed another jump in bulls to 46.9% vs 37.9% prior and up from 25.5% on 10/6. Neutral sentiment fell to 25.4% vs 30.3% prior and bears are 27.8% and down from 40.7% in late September. Bulls are now well above the long-term average while bears are below for the first time in over two months. NAAIM Exposure jumped sharply back to 98.02 from 64.46 and now near multi-month highs. Lipper Fund flows had $10.9B of inflows to equities, the biggest by far in over a month. As of Friday’s close we had 570 new highs vs 204 new lows, strong breadth. The percentage of stocks above their 50-day and 200-MA also increased again with the former at 56.6%. NYSE Summation continued to rise to 225 and remains above its 8-EMA. NASI also hit its highest level since July and in a bull signal above its 8-EMA. Cumulative AD hit new highs this week. CBOE Equity P/C 50-day MA was 0.49 and continues to fall. VXV:VIX rose to 1.325 this week. CNN Fear and Greed rose to 67, up from 50 last week, and the highest level since early 2021.