Note: The charts won’t copy on my iPad.
Trend & Cycle Roadmap
Robert Sluymer, CFA
Technical Strategist, Portfolio Advisory Group
August 10, 2022
Equities overbought short-term but CPI inflation report keeps the current uptrend intact.
US equity markets had rebounded from support near rising 4-year/200-week moving averages back to important resistance bands heading into today’s widely watched CPI inflation report. After a 15% surge, most short-term trading indicators are overbought and beginning to peak, but the recent uptrends remain intact with today’s CPI report pushing most markets to new recovery highs.
Stepping back from the short-term market commentary for perspective, we are revisiting the weekly charts of the S&P 500, Nasdaq and Dow Industrial Average to illustrate the rebound taking hold from longer-term support near rising red 200-week moving averages. While our expectation has been for a near-term pullback to develop, the overall technical behavior continues to improve. Q2 downtrends have been reversed and within the market participation, as measured by the number of stocks advancing verses those declining, continues to improve and has been leading to the upside.
Lastly, the final chart in this week’s Roadmap is food for thought illustrating an important longer-term upside inflection developing favoring cyclical stocks over defensive stocks.
RBC Capital Markets, LLC / Portfolio Advisory Group