Discretionary and Financials look to be very close to support; Market breadth remains an issue

Near-term US Equity trends are bullish, and despite the recent churning, I don’t think much can be made of the stalling out technically.  My thinking is that AMZN, GOOGL, TSLA, NVDA, and AAPL have combined to offer some great leadership despite the stalling out in most of the market in recent weeks. While the bifurcation between large-cap Technology/Discretionary and the broader market is growing more severe, I don’t see this as an issue, just provided Technology can continue pushing higher.  However, overall, I expect that US stock indices have entered a much choppier trading environment between now and the end of November.  Over the next few days, it’s tough to make the immediate case for SPX to push to new highs. However, dips should provide buying opportunities, and it looks doubtful that SPX undercuts 6750 right away before a push up to 6950-7000 into mid-November.

In the short run, the recent churning since last week doesn’t offer much reason for short-term confidence just yet for $SPX or $QQQ, as price action remains choppy while market breadth has proven disappointing lately.  However, none of the recent technical warning signs with regard to market breadth have really led to much weakness, and it still looks likely that Technology pushes higher into mid-November before some consolidation gets underway.  

One can’t rule out a bit more weakness this week, and near-term support lies at 6814, which might not hold if tested, and lead down temporarily to 6784, or a maximum area of support near 6750.  Resistance lies at 6882, then 6950-7000, which should prove to be very strong. 

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