Market Outlook – 05/10/18 – David Settle
Just one week ago, the S&P 500® was closer to breaking below its major February and April lows. But, times change quickly. Today’s move on slightly below-average trading volume, broke the S&P 500® above its prior two near-term peaks. In fact, the S&P came close to showing an overbought cluster with all three lines rising towards the upper-reversal zone. The near-term line has been above the chart’s midpoint now for five straight sessions. The intermediate line came close to crossing the 80th percentile, which would signal a strong bullish trend. Market Sentiment remains in the lower half of its chart but has been basing near current levels for the past four weeks. The Russell 2000® has come close to its all-time highs. Its Market Sentiment line is rising above the 60th percentile. Small-caps’ outperformance (even with today’s smaller gain) is a good sign for risk appetite.
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