There was quite a bit of see saw action after a sizable gap down on the Cohn news. The bulls won at the end of the day with a rally into the close. They did not quite get SPX positive, but pretty close. Breadth was slightly positive. New highs were 90 while new lows picked up a bit to 47. Small caps and tech stocks were much stronger as they will be less affected by tariffs. SPX is stuck between the 50 SMA above and the 20 SMA below. That 20 SMA is starting to turn up though.
This is interesting, but a bit hard to see. Both the green and red counts increased today and are right on top of each other. I think this indicates the market is deciding winners and losers within SPX from tariffs.
IWM closed above its last swing high. Clearly the market thinks it will be a winner.
Generally when QQQ and IWM are showing relative strength it is bullish for the overall market. In this case SPX is being left behind a bit as the market picks winners and losers from the tariffs. News hit around 3 PM that the tariffs would be announced this week and Canada, Mexico and maybe some other places would not be involved. That enabled the market to rally in the last hour. The market might be okay with targeted tariffs. There seems to be more positives then negatives at the moment. I would guess the futures will get above their 200 SMA at some point unless we get another piece of bad news.
Bob
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