Marginal New Highs for S&P 500!

After a six-month rally, US equities are establishing new ground again. The blue-chip S&P 500 Index, for example, edged to new all-time highs on Friday (see Featured Chart). This spurt in bullishness occurred after the latest Fed meeting. No longer is the Federal Reserve running a hawkish policy. On the contrary, investors are expecting the monetary spigot to be turned on again in the next 6-12 months.

Among the Nasdaq tech stocks (See here for a quick intro to Nasdaq), the leader remains Microsoft. Remember, last year it was Apple and Amazon. One market observation is that a shift in stock leadership often takes place after a correction. Indeed, after the Oct-Dec ’18 correction, Apple/Amazon/Facebook all struggled to resuscitate their uptrends into new highs while Microsoft surged ahead. MSFTs recent correction is shallow and found support near its previous resistance at $115 (see below). Prices soon rallied to new all-time highs. The next upside target is at $140 followed by $150.

Interestingly, even Walmart, the largest retailer in the world, propelled to new all-time highs (see below). Its share price is on a steep ascent, which propelled prices above the Jan ’18 highs. The next target is at $120.

Overall, I anticipate more upward momentum in the US equity market.



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