The market had a great day today and many of the sectors are looking up. One sector that Erin noticed in her Diamond Mine trading room this morning was Financials (XLF) which are now bouncing off a strong support level. More than likely we are going to see some followthrough on this rally as the decline had gotten overextended just like the SPY.
Participation is still weak overall, but we did see a nice bump in stocks above their key moving averages. We also see that the Silver Cross Index has turned back up. As noted, readings are still anemic, but they are enough that we could see this reversal carry on. The PMO is about to turn up.
We can see how strong and important this current support level is. We have a bearish double top that has developed on the weekly chart and that implies this support level won't hold. The weekly PMO is in decline as well.
Conclusion: More than likely we will see more rally out of Financials next week unless the market takes a turn for the worse, then all bets are off. The weekly chart does tell us that any rally we get could be limited as we have a large double top to contend with.
The DecisionPoint Alert Weekly Wrap presents an end-of-week assessment of the trend and condition of the Stock Market, the U.S. Dollar, Gold, Crude Oil, and Bonds. The DecisionPoint Alert daily report (Monday through Thursday) is abbreviated and gives updates on the Weekly Wrap assessments.
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MARKET/SPX SECTOR/INDUSTRY GROUP INDEXES
Change Today: 
Change for the Week:
CLICK HERE for Carl's annotated Market Index, Sector, and Industry Group charts.
THE MARKET (S&P 500)
IT Trend Model: NEUTRAL as of 3/4/2025
LT Trend Model: BUY as of 3/29/2023
SPY 10-Minute Chart: The rally began in earnest at the open after a gap up. Price did seem to find equilibrium as it consolidated sideways. We like the final 10 minutes of trading where we saw a breakout. The 10-minute PMO is flat and unhelpful right now, but Stochastics are rising.
SPY Daily Chart: The steep declining tops trendline was broken on today's rally. Now we look ahead to the next declining tops trendline. There is near-term resistance that will need to be dealt with at the 200-day EMA. We checked, the PMO did not turn up yet.
The VIX is still holding below its moving average on the inverted scale so there is still some weakness visible. Clearly investors are feeling less fearful given its rise out of oversold territory on our inverted scale. Stochastics did turn up but remain below 20 signaling there is still internal weakness to contend with.
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SPY Weekly Chart: The secular bull market rising trend has been compromised as has the 43-week EMA. We see a double top that was confirmed with the drop below the confirmation line. We do have to say that the minimum downside target of the pattern was nearly met so an upside reversal isn't out of the question. The weekly PMO looks particularly bearish as it accelerates lower.
SPY Monthly Chart: We normally publish the monthly chart at the end of the month, but we can already see parabolic has been broken, and it is not likely that this situation will be repaired in the next two weeks. This breakdown implies a probably extended period (weeks to months) of decline. We could get lucky with high level consolidation versus a bear market, but the monthly PMO has topped.
New 52-Week Highs/Lows: We didn't see that many New Highs and we would have expected to see more given the over 2% rally today. We did see fewer New Lows. The High-Low Differential has just dropped beneath the zero line. It is getting oversold.
Climax Analysis: There were unanimous and strong climax readings on the four relevant indicators, giving us an upside initiation climax. SPX Total Volume was solid, but it was lighter, we think, than it should have been.
*A climax is a one-day event when market action generates very high readings in, primarily, breadth and volume indicators. We also include the VIX, watching for it to penetrate outside the Bollinger Band envelope. The vertical dotted lines mark climax days -- red for downside climaxes, and green for upside. Climaxes are at their core exhaustion events; however, at price pivots they may be initiating a change of trend.
Short-Term Market Indicators: The short-term market trend is DOWN and the condition is NEUTRAL.
Swenlin Trading Oscillators (STOs) are still technically in neutral territory, but are certainly near-term oversold which would support a bounce. Both STOs turned up today which also seems to suggest the rally will continue. Participation moved higher, but is still fairly low at 30%. We saw quite a few more rising PMOs which bodes well.
Intermediate-Term Market Indicators: The intermediate-term market trend is DOWN and the condition is NEUTRAL.
We did see the ITVM turn up today which also supports the idea of more rally, but the ITBM did still move lower so it is a mild confirmation of now rising short-term indicators. We continue to lose PMO BUY Signals, but given we now have 38% with rising PMOs, we should start seeing some new ones come in.
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PARTICIPATION TABLES: The following tables summarize participation for the major market indexes and sectors. The 1-Week Change columns inject a dynamic aspect to the presentation. There are three groups: Major Market Indexes, Miscellaneous Industry Groups, and the 11 S&P 500 Sectors.
IT Biases are primarily negative right now. Golden Cross Index values are higher than Silver Cross Index values and that is what is causing the problem. We have a good foundation in the LT based on that, but intermediate-term we're not seeing high enough Silver Cross Index values and that is skewing everything negative.
The highest IT Bias goes to Consumer Staples (XLP) which have enjoyed quite a rally as the rest of the market has lost ground. It is beginning to turn over however so we think this condition will end next week.
Regional Banks (KRE) have the worst IT Bias as they saw the Silver Cross Index killed by its decline out of its highs. The foundation is strong on the Golden Cross Index but much work needs to be done on KRE's SCI.
This table is sorted by SCI values. This gives a clear picture of strongest to weakest index/sector in terms of intermediate-term participation.
Gold Miners (GDX) continue to outperform and saw seven percentage points gain on the Silver Cross Index.
Semiconductors (SMH) lost a huge 20 points from its Silver Cross Index this week. We have to say the group looks very interesting on this new rally.
This table is sorted by GCI values. This gives a clear picture of strongest to weakest index/sector in terms of long-term participation.
Gold Miners (GDX) also gained the most Golden Cross Index points. The foundation is getting stronger.
Technology (XLK) lost the most Golden Cross Index points, but with this new rally we expect to see some more upside out of this sector.
PARTICIPATION CHART (S&P 500): The following chart objectively shows the depth and trend of participation for the SPX in two time frames.
- Intermediate-Term - the Silver Cross Index (SCI) shows the percentage of SPX stocks on IT Trend Model BUY signals (20-EMA > 50-EMA). The opposite of the Silver Cross is a "Dark Cross" -- those stocks are, at the very least, in a correction.
- Long-Term - the Golden Cross Index (GCI) shows the percentage of SPX stocks on LT Trend Model BUY signals (50-EMA > 200-EMA). The opposite of a Golden Cross is the "Death Cross" -- those stocks are in a bear market.
The market bias is BEARISH in the intermediate and long terms.
Participation continued to slide this week and is now approaching oversold levels. %Stocks > 200EMA has really slid and is definitely looking near-term oversold now. The Silver Cross Index turned up today which does bode well for a possible rally continuation next week. The Golden Cross Index is declining rapidly suggesting to us that the longer-term outlook is not bullish. Both the Silver Cross Index and Golden Cross Index are below their signal lines so the IT and LT Biases are BEARISH.
BIAS Assessment: The following table expresses the current BIAS of various price indexes based upon the relationship of the Silver Cross Index to its 10-day EMA (intermediate-term), and of the Golden Cross Index to its 20-day EMA (long-term). When the Index is above the EMA it is bullish, and it is bearish when the Index is below the EMA. The BIAS does not imply that any particular action should be taken. It is information to be used in the decision process.
The items with highlighted borders indicate that the BIAS changed today.
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CONCLUSION: The market saw a strong rebound off lows that took out the short-term declining trend. The decline got very overextended and was due to see some kind of snapback. The question is whether it can continue next week. Given STOs have turned up along with the ITVM, we think that we could see the SPY follow through on today's rally. Overall the environment on tariffs, geopolitics and the economy have not changed so we likely won't see all-time highs again for some time. At this point it appears we have a nice snapback rally on our hands that could possibly be exploited in the near term. We would say that we are cautiously bullish moving into next week, but don't think the intermediate-term decline is over yet. Next Wednesday the Fed announces their interest rate decision, which is generally expected to be "no change."
Erin is 20% long, 0% short. (This is intended as information, not a recommendation.)
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CALENDAR
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BITCOIN
Bitcoin Daily Chart: The topping formation remains on Bitcoin and despite a small rally, we aren't seeing the declining trend challenged yet. The PMO is flat and not very enlightening. It is below the zero line so this rally is likely a sign of diminishing weakness not new strength. Stochastics are rising so we are looking for a bit more upside here, but ultimately the intermediate-term picture hasn't changed given this top.
Bitcoin Weekly Chart: After zipping higher after the election, Bitcoin stalled and formed a bearish rounded double top. Support has been hit so this is a good place to look for a rally. Unfortunately the weekly PMO is still declining and hasn't really decelerated. We like this as a new support area, but that weekly PMO tells us we can't count on a rally despite reaching strong support.
BITCOIN ETFs
Today:
This Week:
INTEREST RATES
Long-term rates have formed rising trends in the short term. We expect them to continue higher from here. Short-term yields are now rebounding so we could see all yields move higher for longer.
The Yield Curve Chart from StockCharts.com shows us the inversions taking place. The red line should move higher from left to right. Inversions are occurring where it moves downward.
10-YEAR T-BOND YIELD
$TNX broke its near-term declining tops trendline but now it has another one ahead. We would look for the yield to test that declining tops trendline. The PMO is nearing a Crossover BUY Signal and Stochastics are rising. $TNX is dealing with a resistance zone, but we believe it will eventually overcome it.
10-Year Bond Yield Weekly Chart: We could be ready to see a bounce of the prior declining tops trendline given the higher low this week. There is the problem of a new weekly PMO SELL Signal, but the PMO is flattening out already.
MORTGAGE INTEREST RATES (30-Yr)**
**We watch the 30-Year Fixed Mortgage Interest Rate, because, for the most part, people buy homes based upon the maximum monthly payment they can afford. As rates rise, a fixed monthly payment will carry a smaller mortgage amount, which shuts many buyers out of the market, and potential sellers will experience pressure to lower prices (to no effect so far).
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This week the 30-Year Fixed Rate changed from 6.63 to 6.65.
Here is a 50-year chart for better perspective.
BONDS (TLT)
IT Trend Model: BUY as of 2/25/2025
LT Trend Model: SELL as of 12/13/2024
TLT Daily Chart: We are expecting Bonds to move lower from here based on the bullish look of yields. You can see the rising trend on the 20-year yield. However, we do have to note that we have a bullish cup with handle pattern on TLT. The PMO triggered a Crossover SELL Signal today and Stochastics are still moving lower so we would look for the handle to get longer on the pattern before we see a breakout again.
TLT Weekly Chart: We saw a bounce off the top of the prior rising wedge and support at 85. The weekly PMO looks better than the daily PMO. It does seem to suggest we'll see higher prices in the intermediate term. Resistance is arriving on the weekly chart at the last top.
DOLLAR (UUP)
IT Trend Model: NEUTRAL as of 3/5/2025
LT Trend Model: BUY as of 5/25/2023
UUP Daily Chart: The Dollar wants to rally off this level but it just can't get anything going. The PMO is trying to bottom and Stochastics are rising, but this should be seen as diminishing weakness not new strength. We expect to see the Dollar consolidate sideways.
UUP Weekly Chart: Price had broken up and out of the bearish rising wedge, but it has now failed and is back within the wedge. The chart is bearish with the weekly PMO sailing lower and the weekly RSI in negative territory. We do have support nearby so it makes sense that we're seeing it consolidate right now.
GOLD
IT Trend Model: NEUTRAL as of 12/23/2024
LT Trend Model: BUY as of 10/20/2023
GLD Daily Chart: Gold set another all-time high today but it formed a bearish filled black candlestick that does suggest it will cool on Monday. The chart is very bullish with a PMO BUY Signal about to arrive well above the zero line. Stochastics are holding above 80 and are rising. We can also see that the relative strength line to the Dollar is rising so even if the Dollar gets going Gold is currently outperforming it and could continue to move higher.
Discounts popped yesterday meaning that investors are actually getting bearish on the metal. We see this as positive given sentiment was fairly bullish leading into this reading. Remember sentiment is contrarian so we actually want to see higher discounts.
GLD Weekly Chart: It is traveling in a parabolic rally, but it hasn't really turned vertical yet so we think it is likely to move higher before breaking down from this formation. Parabolics always breakdown so it is just a matter of time. The weekly PMO is on the rise on a Crossover BUY Signal that occurred well above the zero line so we do think there is more upside available for Gold, meaning more all-time highs.
GOLD MINERS Daily Chart: Gold Miners hit overhead resistance at the October top. This is where we should look for a pullback. However, the indicators are extremely bullish and could support higher prices. The RSI is not overbought yet. When it gets overbought we'll start looking for some decline. Until then it looks good with the new PMO Crossover BUY Signal today and perfect 100% participation of stocks above key moving averages. The Silver Cross Index and Golden Cross Index are healthy and moving higher. Certainly participation is overbought, but those conditions can easily persist in a good bull market rally like we're seeing out of GDX. We see more upside ahead given the bullish outlook for Gold.
GDX Weekly Chart: We have a breakout on the weekly chart intraweek, but it did close below that resistance level. It is at a closing high though. The weekly PMO looks very good and though GDX has reached strong overhead resistance, we think there is still more upside ahead.
CRUDE OIL (USO)
IT Trend Model: NEUTRAL as of 2/27/2025
LT Trend Model: BUY as of 1/10/2025
USO Daily Chart: This week USO formed a small symmetrical triangle. These are continuation patterns so given the prior trend was down, the expectation is a breakdown not a breakout. The PMO is flat and the RSI is negative so we think a breakdown makes sense. Stochastics are rising, but we agree with the chart pattern that we'll see a breakdown.
If we get the breakdown, there are plenty of support levels off which it could rally based on the September-November lows. We believe that ultimately we will see support tested at the September low.
USO/$WTIC Weekly Chart: A rally higher isn't out of the question given price is still holding onto a rising bottoms trendline on the weekly chart. Still we have a weekly PMO SELL Signal and a negative weekly RSI so a breakdown seems likely.
Good Luck & Good Trading!
Erin Swenlin and Carl Swenlin
Technical Analysis is a windsock, not a crystal ball. --Carl Swenlin
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