Last Gasp? – Plus Yields

The S&P rallied 1.2% on Thursday, aided by good breadth (NYSE gainers outpaced losers by almost 5:1) and better volume. Moreover, the index broke out through a “triple top” on the point and figure charts.

That’s the good news. The bad news (for now) is that we are inclined to count Thursday’s breakout as a last gasp from the July lows (a fifth wave in Elliott Wave terms). However, and as mention in prior reports/blogs, the evidence suggests that this rally is only the first leg of a larger uptrend from those same July lows (the A of an ABC rally). Thus, while the “500” is at risk of a fairly sharp decline over the near term, that correction will likely be followed by another run to higher highs. At that point we will begin to be more concerned about the end to this post-March bear market rally.

The S&P never did test the 957-950 area mentioned in yesterday’s post. As a result, we will give this current “last gasp” the benefit of the doubt as long as the index holds above 968.65. A violation of that level would be an indication that the entire rally pattern from July 8 was complete and that a reaction (a “B” wave) of a week or more was under way.

The door remains open for a challenge of chart and Fibonacci resistance in the 1007-1048 range.

10-Year Yields

Ten-year yields are at an interesting juncture. In the recent STR we mentioned that the window for a challenge of June’s high was closing rapidly. Thus, if yields were to complete a five-wave rally from December’s low, they had to do so quickly.

That said, it appears that both the daily and weekly Coppock Curves are peaking. The Coppock is our favorite momentum measure, and the current condition suggests that an intermediate decline is imminent. However – and this is a big “however” – the rally from the July low can be counted as a five wave pattern. So, even, if a downside reversal occurs here, we can still nominally count the entire pattern from the December lows as a five-wave pattern in its own right. The “failure” to record new highs in recent days would suggest a potentially deep retracement in coming months, but a five wave post-December-July rally would imply that the December lows will not be violated. Indeed, the ability to count five waves since December would be a piece of initial evidence that the 28-year down trend in yields had ended.

A decline back through 3.29% would imply that both the rally from the July lows and the larger uptrend from last December low was over.

A Pullback Within an Uptrend

The S&P fell 0.5% on Wednesday. This marked the first time in three weeks that the index had back-to-back losses. Overall, though, it wasn’t a bad day. Many of the indexes (but not the “500”) recorded an inside day (a lower high and higher low than the previous session), which is an indication of indecision. Total volume was negligibly higher than Tuesday’s turnover, but despite the fact that declining issues on the NYSE outpaced the gainers by a ratio of more than 2:1, downside volume was only 20% higher than upside volume.

The volume and breadth data suggest that the big-cap stocks held up relatively well on Wednesday, with more of the pressure on the smaller cap issues. Indeed, breadth for the S&P 500 was negative by a ratio of 1.9:1; this compares to a 2:1 ratio of decliners to gainers for the for the S&P 600 Smallcap index.

S&P 500 with Daily Coppock Curve


In our view, the pullback of recent days is probably a fourth wave from the July lows, though it may prove to be a “B” wave. The main difference between the two is that a fourth wave pullback will likely be shallower than a “B”. However, both patterns suggest that the final highs have yet to be seen.

With the above in mind, the 957-950 area should be decent support. It represents both a typical Fibonacci range for a normal fourth wave and it also represents June’s topping formation prior to the decline into July’s low. Thus, a pullback into that range would be a normal test of the recent breakout point. Below 957-950, we will be inclined to put more focus on the July bottom at 888-869, which we upgraded to tactical support in the recent STR.

July’s breakout opened the door for a challenge of chart and Fibonacci resistance in the 1007-1048 range. Our view that the decline of recent days is either a fourth wave or a “B” wave keeps this range in play.

A Bottom, Not THE Bottom for House Prices

Tuesday had two noteworthy news items: the Case-Shiller indexes of house prices rose for the first time in almost three years and the Conference Board’s measure of consumer confidence fell again. Most market comments attribute today’s stock market malaise to the latter; we’re sure if the eqity indexes were higher, the house prices would grab headlines.

Case-Shiller 20-City Index with Monthly and Quarterly Coppock Curves

For our part, we believe that the uptick in the Case-Shiller data is nothing more than a precursor to a relief rally. That rally may take some months to play out, but it will probably be followed by another downtrend. We say this for two reasons. First, the momentum background is at “bad oversold” or confirming levels. Typically this means that the price low associated with this condition is the first low, not the low; a rally-then-test sequence is the usual course of events. Moreover, the momentum condition suggests that the housing pressures are secular (15-25 years) in nature, not cyclical (about four years +/-). Second, there is no nearby chart support for the 20-city index. The index may have to eventually fall to levels last seen in 1997 before it finds support. If so, that would imply a decline of 50% from current levels before the secular decline runs its course.

All in all, a rally in house prices in the months ahead may be an opportunity to become a renter.

A New STR

The three-wave June-July decline locked in the previous rally from the March low as a complete pattern. Thus, the subsequent rally from July’s low, accompanied as it is by strong momentum and breadth readings, has to be viewed as a second leg within a larger, unfinished post-March uptrend. Given that the March-June rally was quite clearly a corrective structure, it would seem that the overall pattern has become fairly complex. In Elliott Wave parlance, it could be a double-three (or even a triple-three). In “Plain English” that means that two (or three) corrective patterns are connected to one another to make up a larger corrective pattern. (There is no such thing as a quadruple-three.) All of this means that, despite the non-Elliott strength of recent weeks, the pattern from the March low is best counted as a bear market rally.

The above is the opening paragraph of a new Short Term Review that we sent out today to our preferred distribution list (those who have expressed at least initial interest in becoming a future subscriber). If you would like a copy and would like to be put on the preferred list, send an e-mail to wmgallc@gmail.com.

Trend Analysis

Not Afraid to Change

So here we are on the New Jersey Shore in preparation for a weekend birthday celebration for two of our kids at a place on the beach without internet. But lo and behold, somebody someplace has an unsecured signal, so here we are. That, plus an eye-opening surge by the indexes, virtually demands a post (despite the editorial warning to the contrary in Wednesday’s blog).

No doubt about it, Thursday was a good day. The S&P rallied 2.3% to move decisively through resistance at 956. It was not a 9:1 day, but breadth and volume ratios were very solid. And, unlike many of the recent up days, total volume was significantly higher than the previous day’s total.

Over a month ago (July 14), we observed that the evidence for a rally to or through June’s 956 high had strengthened. We felt that such a rally would be a short term event, suitable only for more aggressive traders. Granted, even more conservative folks wish they were all over this rally, but our body of evidence still suggests that this is a short term “last gasp” in the context of a deteriorating intermediate trend.

We are not afraid to admit mistakes, but the evidence is not there. We have made the case that new recovery highs would result in more divergences. While the divergence are not as many as we thought, they are there. For example, Thursday’s high for the S&P was 2.4% above June’s high, but over half of the stocks in the index are at least 2.4% below their high of the past 100 days. This suggests narrow participation.

Thus, we continue to view the rally from the early July low is a short term event. We view it as an ending of a mature bear market rally pattern. It is not the beginning of a new bull trend. If the evidence changes, so will we. The evidence has not changed, so we are staying the “bear market rally” course.

The rally through 956 now opens the door for a challenge of chart and Fibonacci resistance in the 1007-1048 range.

The recent strength means that 870-869 is now first support. It may be tactical support, but – for now – we will continue to use 879-866 as tactical support. If that range is violated, we would be inclined to look for further weakness toward at least 812-777.

Missing in Action

Editor's Note: On the road again, and access to e-mail may be problematic. However, we'll be back on home turf on Sunday and plan an STR next week.

On Wednesday, the S&P fell by less than 0.1% and the DJIA lost 0.4%. Was it a down day? No. Breadth was positive, as was the up-to-down volume ratio. So, the underlying stats were quite constructive. Perhaps the biggest negative was that volume declined yet again.

During the day, the S&P made another recovery high as it approached 960. While the daily a-d line has also recorded new (confirming) post-March high, our accumulation (buying interest) indicator is near the March low, the bullish percentage indicator did not make a recovery high, and only 10% of the S&P stocks are within 10% of their 52 week high. This, combined with an overbought and deteriorating intermediate momentum condition, suggests that, despite the new recovery high by the “500,” most of its components are not near their respective highs. They are missing in action.

S&P 500 with Diverging Bullish Percentage Index

The above supports our view that the rally for the early July low is a short term event. In other words, it is an ending – an extension – of a mature bear market rally pattern. It is not the beginning of a new rally.

Further strength decisively through 956 would open the door for a challenge of chart and Fibonacci resistance in the 1007-1048 range.

The recent strength has not changed our view that the 879-866 range is tactical support; if it is violated, we would be inclined to look for further weakness toward at least 812-777.

Could it Be?

On Tuesday, another late-day rally allowed the S&P 500 to finish with a 0.4% gain. However, breadth was very modestly negative and downside volume was 63% of the total. So from the perspective of both breadth and volume, Tuesday was not a particularly good day.

That said, the S&P did manage to peek above the June highs and the DJIA did rally through 8878. From the perspective of the S&P, this run to a new recovery high is separate from the first leg up from the March low to the May-June high. This new high may be part of a “B” wave or part of a “C” wave, but the March-May/June rally was a complete pattern. This new high is something new and different.

S&P 500 with Post-Fibonacci Resistance Levels

At the same time – and as discussed in Monday’s blog – Tuesday’s high by the DJIA locked in the decline from the October 2007 high to the March 2009 low (or perhaps the November 2008 low) as a complete pattern. In that regard, the structure of the DJIA is finally in line with the structure of the S&P.

We have been – and still are – of the view that the overall uptrend since March is a bear market rally. It would be interesting if, following the modest new recovery high by the S&P and the breach of an important benchmark by the DJIA, the indexes reverse course.

With all that in mind, the potential for a rally through 956 still exists. The next objective is arguably at indicated chart and Fibonacci resistance in the 1007-1048 range.

The recent strength has not changed our view that the 879-866 range is tactical support; if it is violated, we would be inclined to look for further weakness toward at least 812-777.

Structure Versus Strength

On Monday, a last hour spurt allowed the S&P 500 to finish with a solid 1.1% gain. As a result, the index has now rallied over 8% since the July 8 low. (As good as that is, it is half of the 16.2% eight day surge off of the March low.) Breadth was solidly positive and our common stock a-d line has broken out through its June high (that’s a good thing). The up/down volume ratio was also solidly positive, but total volume declined for the fifth time during this eight-day rally (that’s not a good thing).

It is possible – even straight forward – to count five waves up on a weekly chart of the S&P. However, when one looks under the surface at a daily or hourly chart it is, in our opinion, impossible to maintain an impulsive structure. This is why we have referred to this post-March rally as a bear market rally. And this is why we chose today’s title. That is a title we used several times during the 2002-2007 “bull market.” We maintained through most of that run that it was a bear market rally (which is why we always put quotes around the term “bull market) and repeatedly suggested that when it was over, it would be substantially, if not fully, retraced. We cautioned readers to be careful. The same thing is going on now, though probably to a smaller degree, and we have been offering the same words of caution.

S&P 500

That said, there appears to be some important considerations. First, while the S&P has locked in the 2007-2009 decline as a complete pattern, the DJIA has yet to do so. However, a rally by the DJIA though 8878 will eliminate that discrepancy. Second, the S&P has retraced more than 38.2% of the 2007-2009 decline. Thus, the door is open for a 50% retracement (to 1026). Finally, the March-May “A” wave was quite complex; alternation suggests that the current “C” wave will be straight-forward.

With all that in mind, higher highs seem likely. Not only is the current (potentially simple) “C” wave unfinished, but near term momentum is still constructive and likely to maintain this bullish bias into the end of the month. Moreover, sentiment is not terrible. Thus, we repeat our recent observations that, beyond 956, the next objective is arguably at indicated chart and Fibonacci resistance in the 1007-1048 range.

The recent strength has not changed our view that the 879-866 range is tactical support; if it is violated, we would be inclined to look for further weakness toward at least 812-777.

Short Term Review

The three-wave decline from June 11 to July 8 was deep enough to lock in the previous rally from the March low as a complete pattern. In our opinion, that March-June rally can be counted as having five waves, but it is impossible to count the overall pattern in an impulsive fashion. That is because the smaller degree waves were themselves corrective in structure. That means that the “strength” from the March low is best counted as a bear market rally.

That view is bolstered by the idea ...

The above is the opening to our Short Term Review, which we released yesterday. If you would like a copy, please send an e-mail to wmgallc@gmail.com.

Curiosity Killed the Cat

Editor’s Note: The monthly Insights was released over this past weekend. For those not on the distribution list and wishing to receive a copy, please send an e-mail request to wmgallc@gmail.com.

On Thursday, an afternoon rally turned what had been a lackluster day into another solid (0.9%) gain. As a result, the S&P posted its third consecutive up day, which is something that hasn’t happened since June 1. Once again, breadth ratios were solidly positive, but volume ratios were mediocre. Total volume fell 8%, but our buying interest (accumulation) line has poked above the selling pressure (distribution) line, suggesting that this rally has begun to stir some curiosity.

S&P 500 with Near Term and Intermediate Momentum Oscillators
That “curiosity” may continue a while longer. We have suggested that near term momentum is positioned to maintain a bullish bias into the end of July, and that is still our outlook. But we know that curiosity and cats make for a bad combination, and the same might be said here for traders. We believe that the deteriorating intermediate background will withstand the current near term influences and regain dominance. If so, we would expect this rally to be fully retraced – and probably more. That is why we have referred to this rally as an ending, not a beginning. In Elliott Wave terms, it would be the “C” wave within an ABC pattern from the March low. So be careful out there.

Beyond 956, there is chart and Fibonacci resistance in the 1007-1048 range. The recent strength has not changed our view that the 879-866 range is tactical support; if it is violated, we would be inclined to look for further weakness toward at least 812-777.

Nothing Wrong With That One

Editor’s Note: The monthly Insights was released over the weekend. For those not on the distribution list and wishing to receive a copy, please send an e-mail request to wmgallc@gmail.com.

On Wednesday, the S&P 500 had its best day since mid May with a rally of 3.0%. Moreover, that gain was supported by a 29% increase in total volume, breadth and volume ratios generated a 9:1 up day, the downtrend line from the June 11 high was violated, and resistance at 932 was breached. So, in a sense, there was nothing wrong with Wednesday’s performance. Indeed, that performance portends higher rally highs.

In previous posts we have made the case that near term momentum had the potential to maintain its bullish bias into the end of July and that a rally through 932 would lock in the June-July decline as a corrective pattern and open the door for further strength to or through 956. That is the position we are in now. In addition, the strength since Tuesday afternoon appears to have been an Elliott Wave “third of a third.” This is more reason to look for higher highs.

Still, the intermediate background is a concern. We have mentioned that intermediate momentum is likely to have a bearish tone into late September and that the 22-week cycle remains down. The nearby chart shows the relationship between the two. Given that this rally is starting from an overbought condition, we question its staying power.

S&P 500 with 22-Week Cycle Lows and Weekly Coppock Curve

Beyond 956, there is chart and Fibonacci resistance in the 1007-1048 range. At the same time, the recent strength has not changed our view that the 879-866 range is tactical support; if it is violated, we would be inclined to look for further weakness toward at least 812-777.

Before we go we have a quick comment on 10-year yields, which rallied sharply Wednesday. It is possible to count the rally of recent days as an Elliott Wave fifth wave. If that proves to be true, it would likely have negative implications for the health of the 28-year secular downtrend. Of more immediate interest, 10-year yields have been paying close attention to an uptrend line since December. Indeed, there have been as many as seven “touches.” Clearly, a violation of that trend line would represent an important change, regardless of the “count.”

10-Year Yields with Dominant Uptrend Line

Bear Market Rally in a Bear Market Rally

Editor’s Note: The monthly Insights was released over the weekend. For those not on the distribution list and wishing to receive a copy, please send an e-mail request to wmgallc@gmail.com.

Fun Fact: The S&P 500 gained 0.5% on Tuesday. That strength was not surprising. On Monday the index closed right at the session’s high. Historically, that happens less than 5% of the time. But when it does, the next day has followed through 85% of the time.

Both breadth and volume ratios were solidly positive again on Tuesday. However, total volume fell 11% from Monday’s already low level. As such, turnover continues to languish below its declining 21-dma.

NYSE Consolidated Volume with 21-dma

Near term momentum has a bullish bias, and we continue to think that this condition has the potential to exist through the month. Nonetheless, the “500” is still below the dominant downtrend line from the June 11 high; that line is just above 916 and declining by 1.74 per day.

Sentiment has improved somewhat. In our recent monthly, we described the sentiment background as neutral to positive with only the 10-day CBOE put/call ratio in overbought territory. That indicator is now viewed as neutral.

Tuesday’s rally increased the evidence that the decline from the June high will prove to be a corrective or counter trend event. If so, then we would need to be alert for a rally back to or through June's 956 benchmark. In that regard, a rally through 932 in coming days would confirm the corrective nature of the June-July decline.

However, given the body of evidence associated with the intermediate background, we remain inclined to treat the potential for a challenge of June’s high a suitable only for the more aggressive traders among us. Intermediate momentum is likely to have a bearish tone into late September, the 22-week cycle remains down, and the structure of the rally from March’s low is, itself, corrective. All of this suggests than any near term strength will be a bear market rally within a bear market rally. That is a recipe of more and greater negative divergences than those that already exist.

The 879-866 range remains tactical support. If breached, the door would be open for further weakness toward at least 812-777.

Staying the Course

Editor’s Note: The monthly Insights was released over the weekend. For those not on the distribution list and wishing to receive a copy, please send an e-mail request to wmgallc@gmail.com.

The S&P 500 gained 2.5% on Monday. That was its best gain since June 1, supported by solid breadth and volume ratios. However, Monday was not a 9:1 day and, while total volume increased over Friday’s level, it remains below the declining 21-dma.

Most near term momentum oscillators are oversold after failing to make any meaningful progress from their previous oversold condition. This suggests that they may be better positioned to support a rally this time. In addition – and as mentioned in the recently released monthly Insights – sentiment is also generally neutral to oversold. All of this suggests that the near term environment could be constructive through the rest of the month.

That said, a rally through 932 would lock in the decline from the June 11 as a corrective pattern. If that were to happen, we would be alert for further strength to or through those June highs (at 956).

However, medium term momentum will likely withstand any near term strength and we think it reasonably likely that the 22-week cycle will also withstand a near term rally. So, new recovery highs would merely serve to generate more negative divergences than those that already exist.

As a result, we are inclined to stay the course and suggest that near term strength is likely most suitable for more aggressive traders. The current evidence suggests that the medium term pressures are likely to persist. Surprises should be to the downside.

The 879-866 range remains tactical support. If breached, the door would be open for further weakness toward at least 812-777.

A rally through 904 would increase the probability that the decline from the June 11 high as a corrective pattern. As mentioned, a violation of 932 would seal the deal. Beyond that we would look of June’s 956 high.

Up Close and Personal

Editor’s Note: Depending on the sun, the fishing, and the relatives on Cape Cod these blogs may be a little sporadic, but we will endeavor to keep a pretty regular pace.

At the same time, our July monthly Insights has been a work in progress. It should be released this weekend (fingers crossed).

For quite a while we have been pointing to 879-866 as a tactical support range. In a sense “tactical” is a synonym for “intermediate.” Thus, it is our view that a decisive breach of 879-866 would do much to confirm an intermediate breakdown or reversal from the March-June uptrend.

That said, it is important to note that, while the S&P 500 has been “up close and personal” with that range over the past three days, support has held. Moreover, the pattern of the decline is increasingly corrective and near term momentum is more oversold than not. Thus, we need to be alert to the idea that the S&P will attempt to make another run back to the June highs in an attempt to overcome the building intermediate pressures.

S&P 500 with Daily Coppock Curve

As a result, the 879-866 is now important for two reasons. Not only is it tactical support, but a decline through that range would probably reverse any attempt by the index to strengthen the near term trend. A decisive break of 866 would likely open the door for further weakness toward at least 812-777.

Conversely, the ability to rally through 898-904 would do much to lock in the decline from at least the July 1 high (and possibly from the June 11 high) as a corrective pattern. That, in turn, would bolster the notion that the index still has one more post-March run in it. So, above 898-904, resistance will likely be encountered at 924-932; beyond that we would look of June’s 956 high. Nonetheless, we continue to respect the bearish intermediate momentum and cycle conditions, and would treat any such “run” as an aggressive counter trend trade.

Nastier and Nastier

Editor’s Note: Depending on the sun, the fishing, and the relatives on Cape Cod these blogs may be a little sporadic, but we will endeavor to keep a pretty regular pace.

On Tuesday, the S&P 500 lost 2.0%. (Interestingly, it is on an eight-day string of alternating gains and losses.) Breadth was poor, as was the up to down volume ratio. Indeed, our 45-month old accumulation model hit a record low. Near term momentum recorded a small – certainly not decisive – downtick.

In yesterday’s comment we described Monday’s action as “nasty.” Tuesday may have been nastier. For some time, we have referred to 879-866 as tactical support. A case can be made that a similarly important point for the DJIA is as low as 8221. If so, that level has been breached. From an Elliott Wave perspective, this confirms the importance of the five-wave June decline and, in turn, seemingly resolved the Elliott conundrum between the DJIA and S&P (which we have discussed several times) in favor of the DJIA. From a non-Elliott perspective, the breach of 8221 may have completed a head-and-shoulders top formation. All of this is, of course, is in conjunction with a poor intermediate momentum background and a bearish 22-week cycle. So, “surprises” are likely to be to the downside in coming weeks.

Dow Jones Industrial Average

That said, the S&P is still hanging on to its tactical support range and near term momentum is still nominally hanging in there (perhaps by the hair on their chinny chin chins). Moreover, the post-June decline for the S&P is much more corrective than that for the DJIA. Thus, we still need to allow for a bear market rally challenge of the June highs. But as we have repeatedly said, such a rally is for aggressive traders. Most, however, need to be on the defensive. They need to be careful.

The 935-936 area remains first resistance with second resistance indicated at June’s 956 rally high. Further weakness through tactical support at 879-866 would open the door for further weakness toward at least 812-777.

How About Nasty?

Editor’s Note: Depending on the sun, the fishing, and the relatives on Cape Cod these blogs may be a little sporadic, but we will endeavor to keep a pretty regular pace.

When asked how the market did on Monday, some may say that the DJIA was up 44 points. They might even tell you that the S&P 500 gained 0.3%. Others might say that is was mixed since the NASDAQ lost over 0.5%. Our answer would be that Monday was n-a-s-t-y.

We say that because, even though the DJIA and S&P closed higher, both had a lower high and a lower low than Thursday. In the process, both indexes reached new lows following their respective June high. In addition, NYSE breadth was moderately negative. And while volume remained low, it was higher than Thursday and our measure of accumulation is very near a new low for the 45 month history of our model. If that weren’t enough, our calculation of the point and figure sector sum indicator for the S&P 500 moved into negative territory for the first time since March.

S&P 500 with Sector Sum Indicator

All that said, near term momentum still has a bullish bias and still has the potential to maintain that condition until our projected mid-month time frame. So while we continue to remind readers that medium term momentum is weak (and likely to remain that way for 3-5 months) even as the 22-week cycle has likely turned down, we are willing to allow for a “pop” back toward the June highs. Clearly, such a rally would merely serve to create important divergences and is suitable for only more aggressive traders. For others, let’s be careful out there.

The 935-936 area is first resistance; second resistance is indicated at June's 956 rally high. We continue to view 879-866 as tactical support; a decisive breach of that range would open the door for further weakness toward at least 812-777.

Nice Start to the New Quarter

Editor’s Note: Despite the violent weather, we managed to make it to one of our favorite places in the world – Cape Cod – where we hope to spend the better part of the next two weeks. Depending on the sun, the fishing, and the relatives these blogs may be a little sporadic, but we will endeavor to keep a pretty regular pace.

The S&P 500 gained 0.4%on Wednesday. Breadth was positive by a 10:3 ratio, but volume fell by 19% to its lowest level since the first day of the year. Similarly, our measure of buying interest remains at its lowest level since January. In that regard, it seems that investors were not very attracted to stocks. The daily Coppock Curve momentum indicator has a bullish bias for 23 of the 24 S&P industry groups.

We were alert to the idea that the S&P would benefit from constructive end-of-the-quarter and holiday underpinnings, and the index has taken advantage by rallying through important resistance at 927. The positive near term momentum environment appears positioned to remain in place for most groups into mid month. Thus, higher rally highs are quite possible – even probable – over the next two weeks. Thus, we will be alert to the idea that new post-March highs will be achieved.

That said, we continue to view this recent “strength” as a short term event. Intermediate momentum is deteriorating, and we believe that the 22-week cycle peaked in early June. Moreover, the bullish percentage indicator for the DJIA and the NASDAQ are still in overbought territory, but are below their June peak. The indicator for the S&P is no longer overbought, but is also below its June peak. Thus, we continue to believe that once this short term rally runs its course, intermediate pressures will reassert themselves. So enjoy it while you can.

S&P 500 Bullish Percentage Indicator

With the breach of 927, the 935-936 area takes over the first resistance position, with second resistance indicated at June 956 rally high. We continue to view 879-866 as tactical support; a breach of that range would open the door for further weakness toward at least 812-777.