Taking the analysis further
If you want to go deeper than the weekly charts — including how the levels translate into actual trade planning and risk management — you can follow the work Brian Shannon and I do at Alphatrends.
That’s where we walk through the same market structure in real time and apply the process to actual trade setups.
Apologies if the audio is a little low. I had to record this “on the go” this morning. Crank the volume, use the closed captioning, and follow along in the show notes.
Summary
The market continues to resolve lower following several weeks of deterioration beneath the surface.
We now have five consecutive weeks of selling in the S&P 500, with repeated closes near the lows and little to no meaningful countertrend bounce. This is not panic or capitulation—rather, it reflects steady, controlled distribution as participants reduce exposure.
What had been a transition phase is now leaning clearly in favor of continued weakness. Participation remains limited, breadth is not yet washed out, and there is still no evidence of demand stepping in with authority.
Until price can reclaim key levels and establish alignment across timeframes, the path of least resistance remains lower. There is no urgency on the long side, and patience continues to be the most important tool.
Weekly Breakdown
Market Environment
Five consecutive weeks of selling in the S&P 500
Repeated closes near weekly lows
No meaningful countertrend rallies
Persistent, orderly selling—not panic or capitulation
Trend & Structure
Price below declining short-term moving averages
Continued sequence of lower highs and lower lows
Failed bounce attempts and weak upside follow-through
Trend remains lower across multiple timeframes
Participation & Breadth
Limited improvement in participation
% of stocks above 50-day stabilizing slightly, but still weak
% above 200-day continues to decline
Not yet at historically washed-out levels
Volatility & Character
Volatility rising gradually—not a sharp spike
Confirms controlled, systematic selling rather than emotional liquidation
Intermarket Observations
Small caps showing relative resilience but still fragile
Bitcoin remains weak below key levels
Bonds under pressure alongside equities
Commodities (especially energy-heavy) remain strong
Dollar consolidating without clear resolution
Sector & Leadership Notes
Former leaders (semis, software, MAG-7) showing increased selling pressure
Defensive positioning remains evident (staples, utilities)
High beta vs low volatility continues to favor defensive posture
Key Takeaways
This is controlled distribution, not panic
The absence of a meaningful bounce suggests buyers are not stepping in
The prior “transition phase” is resolving lower
Breadth is weak but not yet washed out
Leadership continues to deteriorate
What Would Change the Story
Reclaim and hold above key resistance levels
Sustained move above anchored VWAP levels
A rising 5-day moving average with follow-through
Improvement in breadth and participation
Until then, the burden of proof remains on buyers.
Bottom Line
This remains a market environment that favors patience and disciplined risk management.
There is no urgency on the long side, and while short setups can be difficult in extended conditions, the primary trend continues to lean lower.
References & Chart Resources
Chart School
https://www.trading-adventures.com/t/chart-school
The Bullish Percent Index – A Technician’s Perspective
Relative Strength – What Is It Really?
Take the analysis further
If you want to go beyond the weekly charts — including how the levels translate into real trade planning and risk management — you can follow the work Brian Shannon and I do at Alphatrends.
That’s where we review the markets in real time and walk through how the same principles are applied to actual trade setups.
Important: This content is provided for educational purposes only. If you’re reading this online, please review the full disclosure here.
