The market has drifted into a dull, waiting state. Despite what
appeared to be upside breakouts last week, there was no follow-through.
In the end, it will most likely come down to $SPX price once again.
In recent days, $SPX has been bounded roughly by resistance at 1420-1425
and by support at 1395-1400. A breakout in either direction would likely
create some momentum.
Equity-only put-call ratios have remained on buy signals.
Market breadth oscillators have deteriorated, but they still
remain on buy signals (barely).
Volatility indices ($VIX and $VXO) weakened a bit as well.
$VIX has moved up into the 16-to-19 range, which we view as neutral
In summary, the bulk of the evidence is still on buy signals, but
the market itself isn’t responding. So now, we await the
breakout of this narrow trading range in order to confirm the next move.