Stocks continue to struggle. The downtrend of $SPX is quite evident in Figure 1, and as long as that Index is in a downtrend, a "core" bearish position can be maintained. $SPX made a new closing low this week, as it probed down towards 4100 once again. The general area of 4100 4200 still represents near-term support. Below that, the next support area (red horizontal line on chart) is at the highs of about a year ago, just below 4000.
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The chart of $SPX is bearish, with lower highs and lower lows. That is the most important thing to take away from Figure 1. After spiking sharply lower a week ago, $SPX has engineered another oversold rally. In a bear market, those are often swift but usually die out at or just above the declining 20-day Moving Average. It would take a clear breakout over the resistance at 4600 in order to re-establish a bullish trend for the $SPX chart.
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The media seems to think that everything that is wrong with the market and the economy is due to the military conflict, but that is not the case. $SPX is in a bear market and will continue to be as long as the downtrend exists (see the blue line in Figure 1). However, the action on February 24th exacerbated an already oversold condition, and now another oversold rally seems to be taking place.
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$SPX continues to be the best relative performer of the major indices. $NDX (QQQ) has already broken its lows of last September. Meanwhile, the Dow ($DJX) probed the lows of last spring. By far the worst performer, though, is the Russell 2000 ($RUT; IWM), which has essentially wiped out all of the gains of 2021. That is illustrative of what the "average" stock has been doing. I still don't think the media really gets that.
$SPX has support in the 4200-4300 area.
