Market Outlook™ – 02/26/20
Today’s Market Outlook:
Today, the S&P 500® fell another 12 points on another day of extreme trading volume. The posture is now strongly bearish with the S&P trading far below the 30-day simple moving average. Short-term sentiment remains strongly oversold and suggests this pullback may take a week or two to resolve. Long-term Market Sentiment fell below the 80th percentile with a strong likelihood of eventually falling below the chart’s midpoint. This is the worst short-term sentiment since August 2015. The big difference between now and then is that Market Sentiment was already below the 50th percentile by the time markets experienced back-to-back three percent declines. This divergence suggests more downside potential with a possible bullish divergent low developing in the next few weeks at lower Fibonacci support levels.