Market Outlook – 05/09/18 – David Settle
Today, the S&P 500® broke out to the upside by nearly 26 points on below-average trading volume. The intermediate continued higher and now approaches the upper-reversal zone where it could stay for 1-3 months. The near-term remained in overbought territory for a third consecutive day. This short-term pattern helps solidify the posture change. The momentum line bounced after yesterday’s bullish intermediate confirmation signal. Market Sentiment remains below the chart’s midpoint but has started to slowly turn higher too. Of course, if the intermediate posture continues for a few months, Market Sentiment will make its way back towards the top end of the chart again. The intermediate line for the Russell 2000® is already above the 80th percentile and the near-term line sits at high levels as the small-cap index has broken above multiple prior near-term peaks.
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