Range-Bound Market: Will It Rebound or Breakdown?

Update Oct 1 2023

We are in a range-bound market. Let’s see if the market can rebound from here or if it wants to breakdown below the support area in the box below:

Looking at the 10-year treasury yield it actually looks like it found a temporary top last Thursday:

If it starts to trend down we might get some positive moves from the market.

Also, the price of Oil looks like poised for a pause:

Looking at sectors (equal weight), Energy has not managed to break out yet (weekly chart below):

Most sectors look bad, especially Utilities and Consumer Staples while Technology looks poised either for a bounce off the 30-week moving average (weekly chart below):

While the Consumer Discretionary looks vulnerable to more downside, it is a key area of potential support (weekly chart below):

The Greed and Fear Index points towards Fear right now:

All in all, I see a market that bounces from here led by technology stocks, or… if the $TNX (10-year treasury yield) starts going up again… then we’ll see the market keep this current correction. That’s on the short term (next 4-6 weeks). Let’s see what we’ll get.

On a mid-term 3-6 months there is still not enough clarity and we’ll keep tracking inflation, oil prices, the 10-year yield, monetary policy, credit conditions, jobless claims, earnings, and GDP data.

I am not touching my Portfolios this week. Let’s see how the market develops.

Have a great week ahead.

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Important: This is not investment advice. Consult a licensed financial advisor before making any investment decision.