The Nasdaq (both the Composite and the 100) is near an all-time high, while the S&P 500 has managed a minor move above resistance at 2741 this week.
In our view, this confirms short term bullishness back in place from a technical perspective.
The TSX and EuroStoxx50, meanwhile, have corrected after reaching resistance levels but otherwise demonstrate stability near their short-term moving average levels. Nonetheless, risk signals such as a bullish DXY chart, a bearish-biased emerging markets chart, upward-trending U.S.. bond yields and flat volume measures on major stock indices remain in place.
We continue to recommend a cautious overweight to equities in our portfolios and emphasize that heightened market risks as well as volatility are endemic characteristics of late-cycle investing. We will continue to monitor technical conditions on all timelines and across multiple asset classes in an effort to identify credible early warning signs of a market downturn, whether or not such signals precede traditional fundamental indicators. Mean Reversion theory will be a consistent consideration in an effort to ensure that we do not add constituents to our portfolios at inopportune prices and/or times in the business cycle.
FULL REPORT: GPAG TECHNICAL VIEWS 2018 06 07