I doubted that Thursday's downswing was a shot across the bow courtesy of the bears, and instead laid out the case for why the stock upswing is likely to renew itself when I looked at the big picture. And so far, the stock bull run remains intact, regardless of all the non-confirmations out there.
As always, I'll lay out the facts in search of market's upcoming direction, and they still lead me to think that the stock uptrend has more chances of continuing than not.
The bulls are prevailing in the clashing narratives and facts on the ground:
(...) I say so despite the uptrend in new U.S. Covid-19 cases that has many states stepping back from the reopening, rekindling lockdown speculations. I say so despite the Fed having its foot off the pedal in recent weeks, which makes for more players looking at the exit door.
Treasuries aren't relenting. It's corona vaccine and expensive treatment hype against fear. Fear of surging cases and lockdowns that would derail the fragile real economy even more.
Just as I wrote on Friday:
(...) Central banks are standing ready to act, and money printing remains in our future. The greatest real policy risks I see, concern lockdown miscalculations and new stimulus measures.
Any corona progress hopes lift up the cyclicals, and it isn't just the tech, healthcare or materials that are having a good day. There is no mad rush into dollars, just into selected U.S. sectors and Treasuries. Greed is rising but isn't at extremes. The stock bull isn't breaking down - there is no sign of it.
Let's dive right into the S&P 500 performance.
S&P 500 IN THE MEDIUM- AND SHORT-RUN
I'll start today's flagship Stock Trading Alert with the weekly chart perspective (charts courtesy of http://stockcharts.com ):
SPX Weekly Chart