AAPL breakout creates tailwind for SPX despite cyclical downward pressure Array ( [cookie] => 036ab8-6547a6-cf8512-7b95b8-269f28 [current_usage] => 2 [max_usage] => 2 [current_usage_crypto] => 1 [max_usage_crypto] => 1 [lock] => 1 [message] => [error] => [active_member] => 1 [subscriber] => 0 [role] => fsi_macro [visitor_id] => 591084 [reason] => [method] => ) 1
Equity trends from August remain bullish, and SPX has neared the upper edge of its four-month channel resistance while the NASDAQ Composite has now pushed back to new all-time highs. Treasury yields and the US Dollar are both positioned technically for declines in December, and their recent weakness has not yet had any effect on the current appetite for US Equities. Thus far, no evidence of consolidation has played out which lines up with cycle projections and lackluster breadth since September. Overall, while Sentiment, cycles, and DeMark signals, along with lackluster Technology participation, made SPX seem like a risky bet following its 15% rally in 15 weeks from August lows, there simply hasn’t been any evidence of price weakness. As the saying goes, it remains difficult to bet against uptrends in December. While I expect some consolidation in SPX before the price gets above 6100, it could be limited to 5950 given the recent breakout in stocks like AAPL, which are important to SPX and QQQ. Thus, for those looking for a possible near-term consolidation, it could happen from 12/5 until the December expiration before an end-of-year rally.
Overall, pullbacks haven’t happened on schedule, and despite the negative market breadth for US Equities to kick off December 2024 trading, where four sectors out of 11 fell greater than 1%, the bigger news seems to revolve around the NASDAQ Composite finally breaking out above 11/11 peaks.
It seems like the avoidance of this current cyclical downtrend projection might create a larger downward bias in mid-January when the shorter-term cycle looks to peak again.
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