Last week’s call worked out partially. We saw the expected weakness early in the week followed by two up-days. SPY finished the week with -0.64%.
For the coming week we’ve got a rather bullish setup. I do expect a positive week.
Price Action
[bullish]
- Direction: long term up, intermediate-term slightly positive
- Historical ranked volatility: long-term above 0.25 and bellow 0.50
- Trend-health: long-term trending environment (TSI >1.65) and intermediate trend conditions are above 25 and bellow 50.
- Channel: intermediate channel position within lower range.
- OB/OS: RSI(5)>25 and <50, RSI(10)>25 and <50, intermediate term time stretch in lower quartile.
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Seasonality
[bullish]
Seasonality is bullish for April(K) and week 16.
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Correlation
[bullish]
Correlation (M) among S&P500 members is increasing (>0.25 and <0.5) . Short-term we see a significant expansion (RSI3 of correlation>75)
Read more about my correlation related research here.
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Breadth
[bullish]
Market Breadth (N) has weakened, but still up-trending.
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Sectors
[bearish]
Sector setup (O) is bearish. The sector leaders are XLI (Industrials) and XLF (Financials).
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Bonds
[positive]
RISK ON for the bond market (P). Generally this is positive for the stock market, especially with a combined setup (BONDS and DIRECTION).
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