Joe Jasper

Technical Analyst

Vermilion Research

Technical and Quantitative Research

Technical Analysis

<ul>
<li>The weight of the evidence suggests that the lows for this bear market have likely already been established, but that does not mean it will be smooth sailing from here.</li>
<li>The SPX and NDX are both testing important resistance levels (4165-4180 and the YTD downtrend, respectively), making this a logical spot for the indexes to stall and potentially pull back.</li>
<li>Ultimately, we would expect to see support near their 50-day MAs as the market goes through a bottoming process. We remain neutral overall.</li>
</ul>

<ul>
<li>In last week's Compass (July 26) we discussed positive signals that we believe suggested the lows for this bear market may have already been established, or that downside is limited.</li>
<li>We continue to see more evidence that supports this claim; as a result, we are upgrading our outlook to neutral.</li>
<li>The SPX is reversing topside its 4-month downtrend, and the Russell 2000 (IWM), Russell Micro-Caps (IWC), and Russell 2000Growth (IWO) are each reversing topside their 9-month downtrends; the bottom's in.</li>
</ul>

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

<ul>
<li>SPX met the 4,000/20 summer rally target (long from 3,700) with a dip/rally sequence into early August to complete the topping process.</li>
<li>Transitioning from risk on to risk off while finessing the SPX 3,900 pivot support that will define market energy in early August and the macro risk tone.</li>
<li>NDX remains our favored short (aligned with SPX 4,000) and in early August. RTY long from 1,650 met our rally objective at 1,820+.</li>
</ul>

<ul>
<li>SPX risk on July rise (early July buy call) is still missing the final piece of the puzzle - the C wave push to 4,000 for THE short.</li>
<li>Top building process near July 21 and again after a Fed hike knee jerk rise. Aligning risk points in Bitcoin, USD dip and sell levels in Europe and Asia (synergy).</li>
<li>THE short set up before next pain trade lower into September for an SPX decline of 18% with parts of EM and Asia taking it on the chin.</li>
</ul>

<ul>
<li>We continue to view the price action over the past month as a bear market bounce in the S&amp;P 500, Nasdaq 100 (QQQ), and Russell 2000 (IWM).</li>
<li>Each index appears to be forming a bearish flag pattern. Until the S&amp;P 500, QQQ, and IWM can break above their YTD downtrends, we remain bearish.</li>
<li>We continue to believe that this bear market is being fueled by the rising U.S. dollar (DXY), rising 10-yr Treasury yield, and the move higher in WTI crude oil.</li>
</ul>

United States

Standard and Poor's 500 Index is a capitalization-weighted index of 500 stocks. The index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The index was developed with a base level of 10 for the 1941-43 base period.

S&P 500 - SPX INDEX

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