The S&P 500 held support around its 100-day moving average ($4,500) last week and rebounded nearly 5% toward prior highs. We also noticed an improvement in short-term breadth, or the percentage of stocks trading above their 200-day moving average, rising from 55% to 70% over the past two weeks.
Still, breadth has been consistently weak throughout the year, suggesting that many stocks have lagged behind the broader market uptrend. There has been a slight defensive tone during last week’s rebound as consumer discretionary underperformed consumer staples. Our indicators continue to suggest moderate risk positioning, so we will remain selective among stocks and sectors.
Percent of S&P 500 Stocks Above 200-Day Moving Average
Source: Cannon Advisors, StockCharts data