The SPX closed just slightly negative by -0.15% for the week after Friday’s large bearish candle cracked under the 8- and 21-day EMA’s and now looks to rest the 55 EMA at 4440. The market was choppy all week ahead of the big OPEX Friday that saw sellers come out and push prices back under the key 4500 line in sand level that has been seemingly touched each month since July when it cleared above. Resistance is strong at that zone and just above at 4525-4550 while a follow through selloff next week into the more seasonally weaker time period would target a test of 4400 first while key support sits at 4330 but a close below could even accelerate volatility to the downside and see 4300 and 4370 as major supports below with the latter being a level that lines up with the trend channel shown below. RSI is slipping back under 50 as well while MACD sits right at the midline with a potential bear cross nearing.

Market Sentiment/Breadth

AAII sentiment for the week ending 9/13 showed bullish responses decreased to 34.4% from 42.2% prior while bearish responses fell to 29.2% from 29.6%. Neutral sentiment rose sharply to 36.4% from 28.2%. Neutral sentiment is at its highest level since May, and bearish sentiment is below average for the second consecutive week. The bull-bear spread (bullish minus bearish sentiment) decreased 7.4 percentage points to 5.2%. This is the fourth time in five weeks that the bull-bear spread is below its historical average of 6.5%. The NAAIM Exposure index increased to 57.98 from 49.73 and is still under last quarter’s average of 70.22. Lipper fund flows for the week ending 9/13 had $10.5B of inflows in equities, the first week of inflows in 6 weeks. Friday’s close saw NYSE new highs at 45 while new lows of 91 and the 10-day MA of New High/Low Differential is now negative at -23. The percentage of SPX stocks above their 50-MA is 34.2% while those above their 200-MA was 54.4%. NYSI Summation index has crossed back below its 8-MA and in a short term sell signal. NYMO McClellan Oscillator closed at -6 and Neutral. The cumulative AD line is choppy and back below the 40 EMA short term breadth and still just above the 89 EMA long term bull signal. CBOE Equity P/C 50-day MA at 0.69. CNN Fear and Greed index is in the Neutral zone at 52 from 51 last week. The VIX/VXV ratio is at 0.861, which measures the spread between 1- and 3-month implied volatility, and under 0.80 shows market complacency while above 1.0 exhibits fear.