Latest news with #Kolovos
CNBC
25-06-2025
- Business
- CNBC
Investors are on S&P 500 record watch. Here's what chart experts think
The S & P 500 is inching closer to a new all-time high, but chart experts are wondering if the rally is broad enough for more than a head fake. The broad index finished Tuesday's session less than 1% below its record high. If the S & P 500 topped that threshold, it would mark the first fresh all-time high hit for the benchmark since February, before the market whipsawed in the aftermath of President Donald Trump's tariff policy rollout. Now, market technicians are questioning whether the market's upswing can include enough stocks to successfully trade at all-time highs over a longer-term period. Otherwise, they say the S & P 500 may still notch a new record in the coming days, but the climb to uncharted territory would likely be short lived. "We've been arguing, really even since May, that there's enough market cap working to push the S & P 500 to a new all-time high," said Ari Wald, head of technical analysis at Oppenheimer. But, "there's a very fine line between a top and a breakout, and we haven't yet seen the conditions that would suggest that this breakout is sustainable." .SPX ALL mountain S & P 500 Wald pointed out that only 44% of Russell 3000 stocks traded above their 200-day moving averages, meaning less than half of members are considered to be in an uptrend. That raises questions about sustainability for the market, especially given that the S & P 500 sits within striking distance of a new record. In other words, he said that soldiers have to support generals to avoid a false breakout. On the other hand, Wald has also been watching the Russell 2000 , which he described as "pushing up" against its 200-day moving average. Positive momentum in these smaller-cap stocks can bode well for the broader market as the S & P 500 nears records, Wald said. "As go small caps, so goes the cycle," Wald said. "If small caps can start to break higher here, that would support broader participation and a continuation of the cycle." Other technicians have similar qualms about market leadership. Andrew Thrasher, founder of Thrasher Analytics, said some stocks haven't dug themselves out of the hole in the same way the S & P 500 has. "It's kind of a mixed bag," Thrasher said. "We are seeing some positives, but we really want to see breadth expand out more if we get to those highs." A 'recharged' market? In the short term, technicians agree that the S & P 500 should at least have enough momentum to touch all-time highs over the next several days. But for John Kolovos, head of technical strategy at Macro Risk Advisors, the remaining question is if the market has "recharged" enough to power a sustained move above current records. So far, Kolovos said he thinks the answer is yes. He said that the market tends to consolidate before hitting all-time highs, as was seen with the S & P 500 largely trading sideways in recent weeks. "If anything, the market has been going through a bit of a stealth correction over the past month," Kolovos said. Kolovos said a rollover in gold can help ignite animal spirits in the stock market. Down the road, he said outperformance in small caps and any signs of market breadth expanding can push investors to take on more market risk. Additionally, he said the Federal Reserve cutting interest rates would also boost trader sentiment. Beyond technology, Kolovos said the financial and industrial sectors are also doing well right now. These three sectors should be able to help propel the broader S & P 500 higher, he added. Looking ahead, Oppenheimer's Wald said market participants should stay exposed to the large-cap growth names that have shown strength so far in this cycle. That's evidenced by the performance of the Nasdaq 100 , which finished Tuesday's session at a record closing level.
Yahoo
13-05-2025
- Business
- Yahoo
Traders model bullish moves for S&P 500 with tariff tensions easing
(Bloomberg) — The reprieve in US-China trade tensions that sent stocks soaring on Monday has chart watchers anticipating fresh all-time highs for the S&P 500 Index (^GSPC). A New Central Park Amenity, Tailored to Its East Harlem Neighbors What's Behind the Rise in Serious Injuries on New York City's Streets? NYC Warns of 17% Drop in Foreign Tourists Due to Trump Policies LA Mayor Credits Trump on Fire Aid, Stays Wary on Immigration Lawsuit Challenges Trump Administration Policy on Migrant Children The gauge closed above 5,750 — its 200-day moving average — for the first time since late March. According to John Kolovos, chief technical strategist at Macro Risk Advisors, there are now no more major resistance levels left until 6,144, the record high the S&P 500 hit on February 19. So-called resistance levels occur at points where a bullish trend is expected to pause as selling surpasses buying. A break above those levels indicates a shift in sentiment. Subscribe to the Bloomberg Daybreak Podcast on Apple, Spotify and other Podcast Platforms. 'The S&P 500 (^GSPC) trading above the 200-day moving average is another indication that the trend is turning positive,' Kolovos said. 'This increases the odds that pullbacks will be met with increased demand or buying interest. It changes your strategy and sends the signal that we're done with the bear market.' Major US indexes have already erased the losses they suffered since April 2, when President Donald Trump announced sweeping levies on imports, and are within 1% from wiping out their declines this year. Investors are now seeing the easing of trade tensions between the US and China as evidence of the Trump administration tempering their aggressive tariff policies. The latest setup for the S&P 500 has changed how aggressive dip buyers could be if the stock market retreats from where it currently stands — because they expect equities to only rally further. Chart watchers are already modeling what the next bullish levels will be if the S&P 500 breaks above its all-time high. To Kolovos, it would pave the path for the index to hit 6,600. JC O'Hara, chief technical strategist at Roth Capital Partners, sees the next target being 6,450, followed by 6,645, implying a gain of more than 10% above Monday's close. Even so, if history is any guide, a move above the 200-day moving average doesn't guarantee that stocks could move higher. Nearly two-thirds of 14 S&P 500 bear markets since the World War II started with a double digit decline and recovered to within 2% or higher of the 200-day moving average — only to plunge once again around even lower levels, according to Sam Stovall, chief investment strategist at CFRA. That strengthens the case for technical analysts to continue to watch so-called support levels, at which stock indexes typically bounce as they indicate potential buying. Last week's high of 5,720 has turned into a major support level and a potential move below 5,580 would force the index to retest the 5,425 level, Kolovos said. Aggregate equity positioning is still only slightly above the bottom of its longer-run range going back to 2010, according to Deutsche Bank Securities (DB) strategist Parag Thatte. That means investors that cut their positions to stocks because of tariff-driven uncertainty would need to boost their exposure if they want to participate in a rally. Bullish trends are already shaping up across systematic funds, which follow market direction and technical indicators. Commodity trading advisors, or CTAs, are likely turning long on US equities after the market rallied through key momentum levels on Monday, JPMorgan Chase & Co.'s (JPM) Bram Kaplan wrote in a Monday note. Any upcoming short-term dip will likely be bought, not sold, said Craig Johnson, chief market technician at Piper Sandler. ''Pain trade' is now up as the sentiment has changed and the worst case scenario in form of deteriorating corporate earnings is likely not going to happen,' he said. The Recession Chatter Is Getting Louder. Watch These Metrics US Border Towns Are Being Ravaged by Canada's Furious Boycott Two Million Meat Sticks a Day Isn't Enough for Chomps' CEO Maybe AI Slop Is Killing the Internet, After All With the New York Liberty, Clara Wu Tsai Aims for the First $1 Billion Women's Sports Franchise ©2025 Bloomberg L.P. By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy
