Regional Banks will take a bit more time to bottom out

Broad-based selling gripped SPX for a second straight session as 410 of the 500 SPX names fell in trading, and SPX has now given up around 25% of its prior rally from mid-March.

Overall, it looks a bit early for SPX to bottom, but this could be likely into Friday of this week into Monday 5/1 on further weakness.  Momentum is not yet oversold, but it’s likely that recent escalation in some of the shorter-term sentiment measures like Fear and Greed, might evaporate on weakness into next week.

Of particular technical concern lately is the degree that leading sectors like Semiconductors and Transportation names have been weakening.  However, Technology cap-weighted ETFs like $XLK have held support as of Tuesday, 4/26/23.  MSFT was certainly helpful in this regard, and at the time of this writing, (4:30pm EST post market close), $META looks to be trading higher after-hours, at $229.50, vs. its 4:00 pm close of $209.40.

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