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The S&P 500's been "stuck" for two years now. What the S&P 500's price action in April did do is put the S&P 500 in position to break out to the upside. We called April's price action pivotal, but the S&P 500 decided to sit idle in park for the majority of the month and that's anything but a pivot. So now it's the price action in May that will probably prove pivotal and we can't imagine the index can idle for another month.
The S&P 500 finished the month of March last week at 4,109.31, a gain of 3.51%. At March's month end, our work labeled the primary trend as "neutral", or trendless. However, much like the S&P 500 has first and goal from the 5-yard line on the daily chart, the index also has first and goal from the 5-yard line on the monthly chart too. Can the index breakout?
The S&P 500 plunged -4.55% this week with Friday's close at 3,861.59. The index traded fairly quiet most of the week until all hell broke loose after hours on Wednesday and into Thursday's trading when a quasi "gray swan" emerged and gave birth to a potential crisis of confidence across the banking sector.
The S&P 500 gained 1.62% this week with Friday's close at 4,136.48. Friday's weekly close is the highest weekly close since August of 2022. The index has now closed higher four of the last five weeks and has gained 7.73% over that time period. Based on January's strength our work now labels the primary trend for the S&P 500 as trendless, or "neutral". About all that's left for the S&P 500's primary trend to be labeled as up or "bullish" is for the index to close the month of February above the ~4,130 level. It feels like every month has been a pivotal month of late and the price action in February is no different.
The S&P 500 declined -0.14% this week with Friday's close at 3,839.50. The index finished 2022 on a sour note, declining for the fourth consecutive week. In terms of price action, one can certainly say we limped into 2023. Our mantra as we head into 2023 is to position as if the worst is yet to come while being prepared in the event the best is somehow just around the corner.
The S&P 500 gained 1.13% this week with Friday's close at 4,071.70. The S&P 500 put the finishing touches on the month of November this week, rising by 5.38% for the month, the second consecutive monthly advance of more than 5%. While our work continues to label the primary trend as down, or "bearish", further strength into December's monthly close will change the primary trend from down, or "bearish", to up, or "bullish".
