A Bottom May Be Close Now

There's not many occasions the S&P declined in 7 straight weeks

Technical Edge — 

• NYSE Breadth: 45% Upside Volume

• NASDAQ Breadth: 41% Upside Volume

• VIX: ~$29.50

Last Friday, we had a silver lining regarding the worst start for the S&P 500 in more than 60 years. Today, there’s another. 

Last week the S&P 500 logged its seventh straight weekly decline. That had happened once in the last three decades and just three times since 1928. 

The bad news is that in two out of three of those occasions, the S&P went on to decline for an eighth straight week. 

The good news is that the index went on to put in the low during the correction in two out of three occasions. The other time (and most recent 7-week skid) came in March 2001 and went on to make new lows following 9/11. 

At the very least, each decline has marked an intermediate-term low. 

Interestingly, all four of these skids have either come in March or May. Huh. 

Game Plan — S&P (ES and SPY), Nasdaq (NQ), Dollar, Bonds

S&P 500 — ES

Despite a new low in the ES on Friday, we do have some bullish divergence on the RSI. The ES is pushing higher in Globex, but continues to struggle with the 3950 area. 

Note that this area was support earlier in the month and then resistance on Thursday and Friday. It’s now also the 50% retrace from last week’s low to last week’s high.