On Tuesday, Renaissance Macro Research’s Jeff deGraaf brought attention to the recent downturn in the U.S. stock market, which has been declining since its high on July 31, 2023. The , in particular, has been under scrutiny due to its unique 65-day low and a waning uptrend that could be signaling a bearish shift.
DeGraaf’s analysis highlights the trend of cyclical versus defensive stocks as a possible indicator of this shift. The S&P 500’s downturn has prompted closer examination of its 200-day moving average (200-DMA), a key technical indicator often used by traders to determine the overall trend of a market. This scrutiny is further underscored by rising Treasury yields and the ‘s downturn.
Despite the pessimistic sentiment pervading Wall Street, deGraaf noted the resilience of midcap staples. These stocks have been achieving new highs within a basing pattern, demonstrating a solid year-to-date performance amid broader market volatility. This resilience may serve as a beacon of stability for investors navigating the current market conditions.
Nonetheless, the overall trend suggests that caution may be warranted for investors in the U.S. stock market. As always, shifts in market trends require careful observation and analysis to make informed investment decisions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
Read the full article here