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.
Summary
The S&P 500 continues to hold up reasonably well, but the picture beneath the surface is becoming harder to ignore.
Breadth and participation weakened again this week, equal-weight indexes are beginning to break down, bond prices remain under pressure as yields push higher, and several important areas of the market are struggling to make progress. Meanwhile, the SPX and MAGS remain among the notable holdouts.
None of that guarantees lower prices ahead. But the evidence has changed enough to change our behavior.
This week, we’ll look at where the warning signs are developing, the levels that matter most, and why the current environment favors patience, selectivity, and a willingness to let the market prove itself before allocating additional risk.
Key takeaways
SPX remains intact, holding above important longer-term support despite increasing weakness beneath the surface.
Short-term structure remains challenged, with S&P and Nasdaq futures rallying back toward declining 5-day moving averages.
DIA and IWM are deteriorating, while QQQ continues to lag the S&P.
Bonds are a major caution flag. Aggregate, Treasury, and high-yield bonds remain under pressure as longer-term yields push higher.
Equal-weight indexes are weakening, suggesting deterioration beneath the cap-weighted headline averages.
Breadth continues to contract. Fewer than half of S&P 500 stocks are now above their 50-day moving averages, while Bullish Percent Indexes remain under pressure.
Leadership remains narrow and uneven. MAG 7 continues to hold up relatively well while semiconductors struggle and other groups cool off.
The FOMC decision adds another variable this week, but there’s no need to predict either the decision or the market’s reaction.
The response: slow down, stay selective, keep some dry powder, and demand better setups with clearly defined risk.
Let price improve the evidence. A reclaim of the 5-day followed by higher highs and higher lows would give us reason to become more constructive again.
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.
