The SPX closed at 7,584.3 (+0.4%) after bouncing from the confluence zone of the 7,520 weekly level and the 7,515 daily level. The first validation of the bounce came at 10:00 AM with the recovery of the 7,534 daily level, followed by a move over the 7,559 central weekly level around 11:00 AM, establishing a bullish milestone that was consolidated when the central daily level of 7,570 held for the remainder of the day.
These key levels were highlighted in yesterday’s Market Update (access here), alongside the potential bounce for GOOG and AMZN. Both tech giants validated the bearish setups anticipated in the Weekly Compass, but became deeply oversold following steep declines from their respective peaks. In fact, both securities were oversold relative to their Bollinger Bands, as detailed in last night’s premium content.
Healthcare led the market with XLV gaining 3.1% on strong bullish conviction, followed by financials (XLF +2.6%) displaying structural strength, and real estate (XLRE +2.0%) adding further momentum. Capital clearly rotated into value and cyclical sectors to drive the tape. On the downside, technology (XLK -1.6%) managed to close with a green candle by recovering off its lows; it filled its daily gap but fell short of positive territory. Consumer staples (XLP -0.1%) reflected sector indecision, while materials (XLB) printed a neutral doji, which provides little encouragement for GLD and SLV.
Let’s dive deep into the most important chart to watch as we head into the end of the week.
Tomorrow's daily SPX levels are included below, along with the major movers from our watchlist.