$SPX Breaks Support, Bounce Signals Rise as Bear Market Risk Builds

TopdownCharts
03-31

Learnings and conclusions from this week’s charts:

1. The S&P500 $S&P 500(.SPX)$ has broken a key support, bears are in control.

2. Implied correlations + Leveraged ETF trading activity point to rising odds of a bounce.

3. Longer-term market cycle indicators highlight risk of bear market.

4. Markets may need to pivot focus from TACO to Fed Put.

5. Midterm malaise can produce magic (subsequent) returns.

Overall, a common theme in this week’s session is one of “getting closer” (to a major market bottom) as short-term signals brush up against longer-term issues. A key conundrum is whether TACO is still a thing (what’s the quick fix?), or whether the market needs to pivot back to Fed Put…

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