fbpx Weekly Stock Market Commentary 9/24/2021 | Option Strategist

Weekly Stock Market Commentary 9/24/2021

By Lawrence G. McMillan

$SPX broke down on Monday, September 20th, violating several support levels, including the very important one at 4370. A gap was left on the chart at 4430. In a truly bearish environment, further selling would have followed. Instead $SPX has risen, filled the gap, and closed back above 4430. In addition, several buy signals were registered (although to be fair, there are still some lingering sell signals as well).

There is now (untested) support at this week's lows, just above 4300. There is technically some resistance up to about 4490, and then there is also resistance at the all-time (September) highs just below 4550.

Equity-only put-call ratios remains mixed, with the standard ratio falling (i.e, on a buy signal), and the weighted ratio rising (i.e., on a sell signal).

Breadth was poor on the market decline a week ago, and both breadth oscillators dropped into deeply oversold territory. On the recovery rally this week, breadth has improved, and both breadth oscillators have generated buy signals.

$VIX Spiked up and right back down again, generating a new "spike peak" buy signal after just one day in "spiking" mode. This is consistent with most of the "spike peak" buy signals in the last year or so.

In summary, it certainly seems that the bears have lost another chance to take charge. Their last hope seems to lie in the $SPX resistance up to the declining 20-day Moving Average of $SPX, at 4490. But the bulls have new-found strength.

This Market Commentary is an abbreviated version of the commentary featured in The Option Strategist Newsletter.

The Option Strategist Newsletter $29 trial

Share this

Option Strategist
Blog Search

Recent Blog Posts

Trading or investing whether on margin or otherwise carries a high level of risk, and may not be suitable for all persons. Leverage can work against you as well as for you. Before deciding to trade or invest you should carefully consider your investment objectives, level of experience, and ability to tolerate risk. The possibility exists that you could sustain a loss of some or all of your initial investment or even more than your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and investing, and seek advice from an independent financial advisor if you have any doubts. Past performance is not necessarily indicative of future results.
Visit the Disclosure & Policies page for full website disclosures.

-->