Summary:
- Medium-term selling pressure is strong, warning of a secondary correction
- But the primary trend is up and VIX remains low
- Long-term prospects remain bullish
The S&P 500 continues to encounter resistance at 1880 and bearish divergence on 13-week Twiggs Money warns of medium-term selling pressure. Breakout above 1900 would signal a primary advance, but a secondary correction is more likely. The primary trend, however, remains upward.
VIX below 15 continues to indicate low risk typical of a bull market.
The Nasdaq 100 displays stronger selling pressure on 13-week Twiggs Money Flow. Respect of resistance at 3600/3650 would be cause for concern, breach of support at 3400 completing a head and shoulders reversal with a target of 3100* at the primary trendline. Recovery above 3750 is unlikely at present, but would offer a target of 4000.
* Target calculation: 3400 + ( 3700 – 3400 ) = 3100