Sentiment is changing nearly daily, producing wide swings in $SPX. But the Index is still in a downtrend, with lower highs and lower lows on its chart (blue lines in Figure 1). The lower end of the range is just below 4300, as there were several rather strong reversals from that area in the past week. On the upside, there is resistance up to 4465. A broader view shows three support areas (horizontal red lines in Figure 1) at 4233, 4160, and 4060 and, of course, resistance at the all-time highs (4545).
Join Larry McMillan as he discusses the current state of the stock market on Monday, October 4, 2021.
As is often the case, September turned out to be a bearish month, as $SPX made a new all-time high on the 2nd trading day of the month, but then reversed and traded down to the lows of the month on the last trading day. This action has put the $SPX chart in a downtrend, as there are now lower highs and lower lows (on a closing basis). A move below the mid-month low at 4305 would confirm this bearishness. We now enter October, which has a reputation as a "bear killer," but the first part of the month can be ugly before lows are reached later in the month.
Join Larry McMillan as he discusses the current state of the stock market on Monday, September 27, 2021.
Join Larry McMillan as he discusses the current state of the stock market on Monday, September 20th, 2021.
For now, $SPX has tentatively found support near 4435. But that only occurred this week, so it is hardly seasoned or tested. The first truly tested support area is still the major one at 4370, and that is not too great of a distance from today's levels. As long as the support at 4370 holds, the bulls are still in control although it might not completely seem like it right now. A violation of that support area, though, would change things in a negative manner.
Join Larry McMillan as he discusses the current state of the stock market on Tuesday, September 13, 2021.
Join Larry McMillan as he discusses the current state of the stock market on Tuesday, September 7th, 2021.
There is nothing unusual about this week's market action. $SPX continues to rise after the brief pullback on August 16th to 19th. The NASDAQ-100 ($NDX; QQQ) is very strong as well and is making new all-time highs along with $SPX almost daily.
The major support level for $SPX is still 4370, although that is beginning to fade into the distance as the Index plows ahead. For now, we are still of the opinion that the $SPX chart is bullish as long as support at 4370 has not been violated.
After bouncing off of support at 4370 last week (the third time that $SPX has found support at that level --meaning it is now extremely important support), $SPX rallied to new intraday and all-time highs. The NASDAQ-100 ($NDX; QQQ) did the same, but the Dow ($DJX) has lagged behind.
