Charting the Markets: S&P 500 Raises the Bar and Bulls Respond
A strong week to start the month pushes the index towards all-time high levels.
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With the S&P 500 within a whisker of an all-time high (last seen July 31) there is full optimism about the near-term future. Yet, without regard for the calendar (as it turns to a seasonally bearish time period) or the technical indicators (which are short-term bearish) there seems to a worry about markets moving forward. However, they continue to do so.
The wall of worry is up high again! That should please the bulls.
We don't see much change in this weekly chart, but there is another strong candle as the index stays within the uptrend channel. That is very impressive — the bar is being raised each week and the bulls are responding. One thing to note is the potential topping pattern in stochastics (momentum). That could simply mean a slow down in the energy of the prior trend.
That would not be surprise, especially during a month when liquidity is poor. Daily charts of breadth (not shown) are flashing a warning sign, as markets rising with poor breadth is a negative divergence that needs to be corrected at some point (soon).
