Trend for Position Traders
9/13/19… The S&P 500 index’s Position uptrend is fully intact as it sits just below a new all-time high and is supported by a Long-Term uptrend.
The S&P 500 index rose 1% last week on rising trade optimism and growing monetary accommodation by global central banks. The closely-watched index is now back within striking distance of a new all-time high.
The index closed at $3007 on Friday, just below the all-time high of $3025 reached in late July. Year-to-date, the index has risen nearly 20.5%.
The U.S. stock market spent last week climbing higher as the European Central Bank (ECB) launched a new round of quantitative easing and as U.S-China trade tensions appeared to ease with talks between the two countries set to resume in early October.
First up, Europe. Last week, the ECB fully committed to looser monetary policy as it cut its key interest rate even deeper into negative territory (-0.5%). Simultaneously, the ECB announced a new €20 billion monthly bond-buying program that officials said would “run as long as necessary” to stimulate the sluggish Eurozone economy. This new preemptive round of monetary stimulus, which is set to begin on November 1, is the largest stimulus measures to be implemented by the ECB in nearly four years.
The ECB is just one of many global central banks, including the U.S. Federal Reserve, that has begun fresh monetary easing efforts in recent months. The U.S. Federal Reserve is expected to cut interest rates again at next month’s policy meeting slated for September 17-18. As of Friday, the futures market was pricing in an 80% chance of a 25 point rate cut at next week’s FOMC meeting.
Meanwhile, trade tensions between the world’s two largest economies appeared to ease slightly last week. The U.S. and China are both seeking to make compromises to break the current deadlock and to reach some semblance of a trade deal. President Trump delayed a new round of tariff increases, set to kick in on October 1, by two weeks while Beijing vaguely recommitted to purchasing U.S. agricultural products. To accelerate negotiations, it appears China is seeking to separate trade issues from national security issues in next month’s trade talks. While this could certainly deliver a quicker solution for both sides on trade, we will see if Washington will agree to Beijing’s two-track approach soon enough.
Eight of the eleven S&P 500 sectors closed in positive territory last week, led by the Financial (XLF +3.8%) and Energy (XLE +3.5%) sectors. The Real Estate (XLRE -3%) sector led the losers.
Our Market Trakker alert system will keep you advised of the current broad U.S. stock market trend. Smart traders may take the opportunity now to research their favorite stocks and ETFs so that they can take advantage of the inevitable price moves!
When we detect a change in the major Long-Term trend, you will be notified again by email along with details on how we are responding to the selloff.
Long-Term Trend for Long-Term Investors
9/13/19… The S&P 500 Long-Term trend remains in a confirmed uptrend. When our Market Trakker system detects a change in the underlying Long-Term Trend in the S&P 500, this page will be updated and all current members will receive an alert by email.
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(Last Long-Term Uptrend Alert on 4/5/19)
S&P 500 Index ETF (SPY) – 2 Year Weekly Chart
S&P 500 Futures Chart
Updates upon refresh during market hours
Percent of S&P 500 Stocks Above 200 DMA
(Measures market participation)
U.S. New Highs-New Lows
(Gauges internal trend momentum)
S&P 500 Index – P/E Ratio
(Current P/E valuation of S&P 500)
Min: 5.31 (Dec 1917)
Max: 123.73 (May 2009)
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