From the desk of Willie Delwiche.
Time To Be Level: The Trends Matter
The S&P 500 is testing its mid-June low as it remains in a persistent down-trend. Investors and traders can lean against specific support levels, but it is hard to have high levels of conviction when price and breadth trends continue to decline.
The Details: At 24 weeks, the current down-trend has lasted longer than any since the Financial Crisis ended in 2009. Prior to the feast or famine years of the past quarter century, persistent downtrends were normal market behavior.
More Context: Even painful and persistent downtrends eventually end. But for stocks that is much harder to do when bond yields are trending higher (which they are) and/or the dollar is trending higher (which it is). If the stock market trend is going to turn higher, it needs a helping hand from either the bond or currency markets.
Our Deeper Look moves beyond the index and looks at how the market got here and how it is holding up versus where it was in June.
