The stock market continues to hover in its trading range. Despite some promising buy signals from sentiment extremes in put-call ratios and $VIX, there was no follow-through by the Standard & Poors 500 Index ($SPX). We have often said — and still maintain — that price is the most important indicator. Regardless, as long as $SPX remains in the broad 2040-2135 trading range, the chart is neutral.
Equity-only put-call ratios gave buy signals a little over a week ago, and they remain strongly on those buy signals.
Even though the breadth indicators are on sell signals, breadth hasn’t been bad. One strong day of positive breadth would be enough to generate buy signals.
Volatility continues to be bullish in that it’s not rising much.
In summary, the subsidiary indicators are positive — not as positive as they were a week ago, but still positive. Yet $SPX continues to march to its own drum. The outlook is neutral as long as $SPX is contained within this trading range.