April’s high for the S&P500 was not confirmed by the Russell 2000, a potential warning signal says Ari Wald at Oppenheimer. This differs from 2013 when each new monthly high was ‘confirmed’ by a higher high in the Russell index.
BNP Paribas remain bullish for the longer-term outlook for US stocks despite the likelihood that the S&P500 will test support at 1800, at the long-term trendline. If this is broken in this correction, the bank sees the next support at 1740. Their longer-term bullish outlook remains in place as prices are still above the 200-day MA.
The best indicator for US stock direction at present is the 10-year Treasury, says Ari Wald at Oppenheimer & Co.
The Eurostoxx 50 of the largest cap stocks are outperforming the DJ Stoxx 600 but the next largest 150 are not, which is usually suggestive of a market top, according to Riccardo Ronco of Aviate Global.
Hope has been replaced by fear with the US stock market since the start of the Ukraine crisis, says Walter Zimmermann of United-ICAP. This puts into doubt the previous target of 1923 for the S&P500 and opens the possibility of the end of the current bull market that begin at 666 in March 2009.
Elliott Wave analysis of the S&P500 sets an ultimate target of 1923.44 for the S&P500 in this bull market, according to Walter Zimmermann of United-ICAP.
Only a qualified break above 1850 will confirm that a downward correction for the S&P is complete, say BNP Paribas. If this break occurs, the index should then target 1950, although this level is itself a significant resistance point.
Weakness in Amazon stock is creating an opportunity to buy medium term strength, according to Ari Wald of Wolfe Research. Deeply oversold momentum also supports a near-term basing attempt.
Julius Baer remains bullish on equities despite the January Effect suggesting otherwise, says Christoph Riniker, head of equity strategy at the bank.
Potential downside weakness of the S&P threatens long-term trendlines says Walter Zimmerman of United-ICAP. Intermediate support exists at 1765 and trendline support at 1756 and then 1640, but the situation looks more ominous the longer prices sit just above recent lows.