As of 04/13/2018, the S&P 500 cash index formed a weekly swing low.  The low occurred in the week of 04/06/2018 appears to be the weekly cycle low.  It has been 10 weeks since the January high to produce this weekly cycle low. 

With this weekly cycle low in place, will the market resume the bullish run like what happened in 2017?  Our other timing model predicts that the market will most likely be in sideways motion until mid year.  One of the reasons is that the low should have happened in March to make it a seasonal low.  But the DOW made a lower low, S&P 500 and NASDAQ also made low in April, that is out of the seasonal pattern.  It also shows the market is concerned with more things than earnings.  Or perhaps the good earnings have baked in already.  The market is still not cheap enough for the institutions to jump in at the moment.

Interestingly, the oil sector jumped up.  We don’t know if this is a knee jerk reaction to the geopolitical tension or the true trend is forming.  At the moment, XLE has to overcome 73.53 to be considered bullish.  73.53 is the 50-month moving average. In our experience, when a stock is trading below 50-month moving average, it is really hard to get above the line.  It has to have some major catalysts to overcome a four-year moving average.  So we are observing how XLE reacts to 73.53.

Stay put while the market is going thru an asset readjustment in a new interest rate environment.