The S&P Indicator has turned red, signaling the potential start of a downtrend. While yesterday’s candle featured a pronounced lower wick — likely reflecting support from the 100- and 200-day moving averages — the close below the session’s highs suggests renewed downside pressure. The intraday rebound was ultimately faded, with a sell-off into the close reinforcing the market’s current risk-off tone. This sentiment shift is further highlighted by a rotation out of growth stocks into defensive sectors, with the Nasdaq underperforming among the major U.S. indices.
Additionally, the weekly S&P Indicator is showing strong downward momentum, indicating that a bottom may not yet be in place.
Conversely, the S&P Strategy has interpreted the pullback as a buying opportunity and has issued a LONG signal. Furthermore, seasonal trends for the coming month are historically bullish, providing a potential counterbalance to the current bearish setup.