The SPX closed higher by 6% on the week and about half of that move came on Friday to close the week with a sharp rally into 3900. With prices closing back above that level, it’s back to a tricky spot as quarter end nears but using the 8/21 EMA as a road map for short term bias will be key. MACD is crossing to the bullish side so the market might be willing to follow through higher into quarter end. Staying above 3900 can potentially see 3970-4000 if the markets want higher but with 4 days left in the quarter there might be a lot of whipsaws back and forth action as well. The next overhead level is near 4000 where the open gap exists from two weeks ago. If the market traded up into that it would likely be met with stiff resistance near the 55 EMA and start to become short term overbought. The 4110 level from the February lows continues to be a more longer-term line in sand for trend.

Market Sentiment/Breadth

AAII sentiment for the week ending 6/22 showed bullish responses drop to 18.2% from 19.4% prior while bearish responses rose to 59.3% from 58.3%. Neutral sentiment steady to 22.5% from 22.2%.  Optimism is at among the lowest levels recorded in the survey. At the same time, pessimism rose to one of the highest levels ever recorded. NAAIM Exposure fell sharply to 19.86 and is in extreme bearish sentiment. Lipper fund flows for the week ending 6/22 had $5.4B of outflows of equities. Friday’s close saw NYSE new highs at 10 while new lows of 68, bearish breadth but improving. The percentage of SPX stocks above their 50-MA is 22.4% while those above their 200-MA was 24%. NYSI and NASI Summation index both below the 8-MA but starting to curl up. NYMO rose to 0 to end the week in flat and neutral. Cumulative AD remaining in a downtrend below the 40 EMA short term and 89 EMA long term. CBOE Equity P/C 50-day MA at 0.67 and at very high levels. CNN Fear and Greed in Extreme Fear zone at 28 from 14 last week.