In today’s briefing:
- Upgrading Consumer Discretionary (XLY) To Overweight; 5700-5785 SPX Gap Support Holding as Expected
Upgrading Consumer Discretionary (XLY) To Overweight; 5700-5785 SPX Gap Support Holding as Expected
- A weak 20-year note auction last Wednesday sparked the first semi-meaningful pullback since this lockout rally began April 22nd, when we turned short-term bullish (4/22/25Compass) as SPX was testing 5100-5120.
- We will be watching the 10- and 30-year Treasury yields closely, as both are approaching important resistance levels (more on that below).
- Unsurprisingly, SPX only tested short-term gap support on the pullback at 5700-5785, where we said to expect support in last week’s Compass (5/20/25). Expect this gap support to hold.
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