DAY HAGAN TECH TALK
The recent technical deterioration has spilled over into the Large Cap arena. Consequently, the odds look to favor the S&P 500 retesting the lower end of a trading band, currently in the area of 2300.
Art Huprich, CMT
March 22, 2017
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Bottom Line: I like to watch the price trends of global equity markets in order to see if they can confirm or refute the non-trading price trend of the U.S. equity market. While there are currently enough bullish and/or improving international equity market price trends in order to confirm the bullish non-trading trend of the U.S. equity market, the recent technical deterioration that had developed over the past two to four weeks—please refer to Tech Talk reports dated 3/14/17, 3/7/17 and 2/28/17—has spilled over into the Large Cap arena. Consequently, the odds look to favor the S&P 500 retesting the lower end of a trading band, currently in the area of 2300—second chart below.
Despite many international markets' short-term overbought condition, a number of international markets are outperforming the U.S. year to date. Consistent with Day Hagan's continual quest to overweight areas exhibiting fundamental, economic and technical strength, we own a number of the areas shown below.
While the near-term uptrend line at approximately 2339 may provide a "reason" for the S&P 500 to bounce, given the short-term technical deterioration that has developed I think the odds favor that the lower support levels get worked over. Stay tuned and please continue to tighten stops.
Please know that Day Hagan Asset Management appreciates your support and hard work!
Art Huprich, CMT
Chief Market Technician
Day Hagan Asset Management
— Written 03.21.2017. Chart sources: Stockcharts.com.
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