Thin Ice: Navigating a Market at the Brink of Stage 4
March 15, 2026 - Update
Market Update: Staying Patient in a Disrupted Economy
Photo by Joshua Earle on Unsplash
Right now, there is only one story: the conflict in the Middle East. Everything else—from the price of oil to market sentiment—depends on what happens there.
Oil is trading above $100 per barrel, up 70% from its recent lows. The media suggests this conflict won’t end soon. Prediction markets agree, suggesting the Iranian regime is unlikely to change by year-end.
Meanwhile, the 10-year Treasury yield sits at 4.28% and is climbing. While credit is still available, the pressure is mounting. Inflation data recently met expectations, but those numbers don’t yet reflect the recent spike in oil prices.
It looks dark, but this isn’t about making predictions. It is about adapting. Things can change fast—for better or worse.
We are living in an economy disrupted by geopolitics. For now, we must stay patient and hope for a resolution. If the conflict ends, the market will likely rebound sharply. Until then, patience is our best tool.
INDEX: Stage Analysis
1) The S&P 500 View The S&P 500 is no longer in a healthy uptrend. The technical picture has shifted:
Price closed below the 10, 20, and 30-week moving averages.
The index is now sitting right on the 40-week average (approx. 6630).
Momentum has dropped decisively.
Current Label: Late Stage 3, teetering on the edge of Stage 4. Bulls are standing on very thin ice.
2) Key Levels to Watch
Resistance: Any rally toward 6759 (30-week MA) or the 6838–6899 zone should be viewed as a test of resistance, not a sign of strength.
Support: If the index closes below the 40-week average (6630) or loses the 6522 level, we are likely entering a true Stage 4 decline.
3) What the “Tape” is Telling Us The market is weak. It closed near the bottom of its weekly range on high volume. While the RSI is at 45—meaning we aren’t “washed out” yet—there is no sign of a clean bottom. Sellers remain in control.
4) Market Breadth The “average” stock is in much worse shape than the index. Only 36% of US stocks are above their 200-day average. Usually, this means the big index names will eventually “catch down” to the rest of the market unless we see a massive surge in buying soon.
Sector Leadership: Where is the Money Going?
The Winners:
Energy (XLE): The only clear leader. It is strong across all timeframes and benefits directly from the oil backdrop.
Utilities (XLU): This is defensive strength. People are hiding here because they are cautious.
The Damaged Groups: Financials (XLF), Tech (XLK), and Consumer Cyclical (XLY) have all rolled over. In a healthy market, you want to see these offensive sectors participating. Right now, they are the weak links.
The Bottom Line: The bearish path currently has the edge. We are one decisive break away from a Stage 4 problem.
Practical Takeaway:
Stay selective.
Keep cash levels high.
Do not trust breakouts.
Treat rallies as “guilty until proven innocent.”
PORTFOLIOS
10X Momentum Portfolio My stop loss for WisdomTree (WT) was triggered last week for a 6% gain. I am now left with only one position: SNDX.
I am mostly in cash. I have moved the stop loss for SNDX up to $19.90. I am not taking any new trades this week. It is time to wait for a better environment.
That’s all for the week! See you next week!
Important: This is not investment advice. Please consult a licensed financial advisor before making any investment decisions.
Disclosure: The content has been reviewed using artificial intelligence to enhance readability and ensure grammatical accuracy.