Charting the S&P 500: Are Buyers Getting Fatigued?
Taking profits at/near a top is a common trait among investors/traders. It happened again this past week.
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The S&P 500 index managed to stay in the vaunted up trend channel we post about every week. That is certainly a positive but it appears buyers are showing some fatigue.
Sure, the index was up sharply most of the past week but it displayed tired behavior towards the end on Friday as some trade news pushed the markets lower. That move tells us sentiment is awfully fragile here, and that means there could be larger and longer lasting pullbacks at anytime.
The bulls have counted on the dip buyers at every turn, and at some point they may see value when the markets drop. However, what was is concerning about Friday's action is that growth stocks did not participate in any upside behavior, which is often a sign of trouble on the horizon. But it may just be nothing!
Indicators remain strong, money flow ticked up as well. The 14 week McGinley Dynamic (gold, top pane) is now moving nicely higher, supporting the stock market but it is widely separated from the current price, which leaves the markets vulnerable.
