The market was slightly expanded in the short term
Monday's session saw the first closing over the S & P 500's upper Bollinger Band (purple arrow) since the current rally began in late December 2018. In early February, the market reached took over bands and then took a very short break (blue arrow). Tuesday's session included an intraday reversal that started from above the upper band (red arrow). This image is still constructive.
Last Breakout Holding Thus Father
Three weeks ago, S & P 500 (SPY) had just cleared the 200-day moving agent (shown in red below) and approaching high that was done in the fourth quarter of 2018 (blue horizontal line). The chart below appeared first in a February 25 post entitled "Markets Hovering Near Important Guideposts".
The same diagram during Tuesday's session (below) shows that the S & P 500 is trying to hold over three relevant areas. The market seems to have tested 200 days earlier this month (A). Oranglådan (B) has so far done little to slow the market's strong advances from 2018 low. On Friday, the market closed for the first time over the blue line (C) and nailed down 3rd consecutive closing over the Q4 peaks during Tuesday's session. The blue line sits at 2813; Tuesday's closing was 2832. Wednesday's day was 2812 and changed.
In the diagram above, the longer the S & P 500 (VOO) can hold above A, B and C, the easier it is to remain optimistic. It should be noted that the S & P 500 can also come back and re-examine the horizontal blue line that sits at 2813. A retest can take place in a few days or can come weeks / months later. Wednesday's Fed statement and press conference could launch some relevant information affecting the breakout in one way or another.
This Signal appeared once since 1950
In the week's stock market video, we look at an extremely unusual combination for S & P 500 last seen in 1991.
A break for hybrid / defensive assets
While S & P 500 low volatility ETF (SPLV) has worked well and is still hovering near new heights, the belief that owning more conservative S & P 500 shares has declined. If the S&P 500 outbreak exceeds 2813 (TBD), the relative demand for SPLV may decrease further.
The same concept applies to real estate investments (NYSEARCA: IYR). Isolated IYR is still swinging near new heights, but signs of relative weakness are shown in the table below.
Isolated set, gold mining The stocks (GDX) remain in an uptrend relative to the low made in 2018. However, the relative trend has not made a new high since the end of December.
The theme "Lower Conviction of Own Defensive Assets" goes to Bonds (TLT) vs. Stock (SPY) charts as shown below.
Fed's exchange rate forecast
Fed's expelled interest rate forecast delivered Wednesday may provide bonds, revenues and weak dollar assets with a turnaround that says we should be open to a shift at SPLV: SPY, IYR: SPY, GDX: SPY, and TLT: SPY Chart. The stock market's latest short-term extended terms and the response to Wednesday's Fed meeting allow a break to see how things go near 2813 on S&P 500.
Notes: I am / we are long GDX, SPLV, VOMIT. I wrote this article myself and express my own views. I can't get compensation for that. I have no business relationship with any company whose stock is mentioned in this article.