The recent rally phase that was confirmed on the 6th is being tested this morning. With yesterday’s poor action and this morning gap down at the open below key moving averages, our Current Market Outlook has changed.
Our Current Market Outlook has been downgraded to “Uptrend Under Pressure” with a yellow light as of 10am this morning with the S&P500 at 3,905.71. Our “Core Four” (see top of page) has slightly weakened to 2 green lights with 1 yellow and 1 red light. This combination has changed the market’s condition back to a yellow (caution) signal.
The recent attempt for support at the S&P 500’s 50-day moving average is being challenged right now. In fact, the S&P 500 gapped down below its 50-day mav as well as its 21-day mav (not to mention our C.M.O. price trigger) at the open. This is not good technical action. But tests of key moving averages early in a rally phase are often sloppy and violent. Today’s fits the bill.
Watch to see if the key indexes can shake off this sharp pullback and mount an impressive rally back up and over their mav’s on a pick up in volume. If they do, that would be an encouraging sign of strength, especially if it happens by the close tomorrow, and that type of action would cause our C.M.O. signal to move back to a technically healthy green condition.
Game plan: Selectively deploy capital in the strongest areas on your watch list but continue to be cautious and on guard. Demand that the S&P 500 gets back over its 50-day mav before becoming aggressive. Earnings season is upon us – invest accordingly.
Note: You can learn more about The Triumphant Core Four risk management system by clicking here.
Have a Triumphant day! ®
The information in this article is based on data obtained from recognized services and sources and is believed to be reliable. Any opinions, projections or recommendations in this report are subject to change without notice and are not intended as individual investment advice. Not to be used as legal or tax advice.
©2023 Triumphant Portfolio Management, LLC.