Market Direction and Stock Trends

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S&P 500 Index (SPX) - Reaction High »» Weekly Summary Analysis
By: Marty Armstrong | May 8, 2021

ECONOMIC CONFIDENCE MODEL CORRELATION

Here in S&P 500 Cash Index, we do find that this particular market has correlated with our Economic Confidence Model in the past. The Last turning point on the ECM cycle low to line up with this market was 2020 and 2009 and 2002. The Last turning point on the ECM cycle high to line up with this market was 2020 and 2007 and 2000.

MARKET OVERVIEW
NEAR-TERM OUTLOOK

The S&P 500 Cash Index has continued to make new historical highs over the course of the rally from 2009 moving into 2021. Clearly, we have elected three Bullish Reversals to date.

This market remains in a positive position on the weekly to yearly levels of our indicating models.

The perspective using the indicating ranges on the Daily level in the S&P 500 Cash Index, this market remains in a bullish position at this time with the underlying support beginning at 420939.

On the weekly level, the last important high was established the week of May 3rd at 423804, which was up 32 weeks from the low made back during the week of September 21st. So far, this week is trading within last week's range of 423804 to 412859. Nevertheless, the market is still trading upward more toward resistance than support. A closing beneath last week's low would be a technical signal for a correction to retest support.

This market has made a new historical high this past week reaching 423804. Here the market is trading positive gravitating more toward resistance than support. We have technical support lying at 413318 which we are still currently trading above for now.

Right now, the market is above momentum on our weekly models hinting this is still bullish for now as well as trend, long-term trend, and cyclical strength. Looking at this from a wider perspective, this market has been trading up for the past 6 weeks overall.

INTERMEDIATE-TERM OUTLOOK

YEARLY MOMENTUM MODEL INDICATOR

Our Momentum Models are rising at this time with the previous low made 2018 while the last high formed on 2020. However, this market has rallied in price with the last cyclical high formed on 2020 warning that this market remains strong at this time on a correlation perspective as it has moved higher with the Momentum Model.

A closing above last year's high of 376020 will warn of perhaps new highs into next year. A closing below that number would warn that this year could be just a temporary high.

Interestingly, the S&P 500 Cash Index has been in a bullish phase for the past 13 months since the low established back in March 2020.

Critical support still underlies this market at 363330 and a break of that level on a monthly closing basis would warn that a sustainable decline ahead becomes possible. Nevertheless, the market is trading above last month's high showing some strength.

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