BofA survey shows rampant bearishness, yet downtrends remain very much intact

Key Takeaways

  • SPX bounce likely encounters strong resistance into May expiration and turns lower
  • Bank of America (BofA) bearishness means broader market pullback likely nearing a low
  • VIX cycles look to peak in early June, which would line up with Equity lows.
The chart in this report is only accessible to members
The chart in this report is only accessible to members

This daily SPX chart puts our recent bounce into perspective and shows that SPX has some hurdles to overcome before being able to discuss a bottoming process being underway.  Resistance lies at SPX-4080 up to 4155 and an Expiration bounce likely should find strong resistance directly overhead.  This intersects prior February lows which should now become resistance along with the ongoing downtrend line connecting the last few peaks in price.  It’s never wise to make too much of a bounce which has not achieved significant technical progress, particularly when no real capitulation has occurred, despite ongoing bearishness.  Stay tuned.

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Cash levels lining up at the highest levels in more than 20 years indicate 2022 selloff likely in its late stages

The first key takeaway from May 2022’s Bank of America (BofA) Fund Manager survey revolves around the levels of cash balances now being held in Assets under Management (AUM).  As seen below, these have reached the...
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