Market internals are still in pretty good shape, according to Lawrence G. McMillan, president of McMillan Analysis. Despite some recent volatility in the U.S. stock market, the S&P 500 index reached new all-time highs last week, only to see a slight pullback before bouncing back up again this week.
McMillan notes that while there are some signs of weakness in certain areas, overall market internals remain strong. The S&P 500 has key support levels at 5,050, 4,983, and 4,920, with a significant signal to the bears if it drops below 4,800.
One indicator to watch is the equity-only put-call ratios, which have risen despite the market hitting new highs. While this has generated tentative sell signals for stocks, McMillan emphasizes the need for further confirmation before taking a bearish position.
Breadth indicators have been holding up, with breadth oscillators on buy signals and cumulative volume breadth making new all-time highs. New highs on the NYSE have been robust, indicating a strongly bullish market sentiment.
Looking ahead, McMillan recommends maintaining a core bullish position in the market and being prepared to trade around confirmed signals. While there is the possibility of new sell signals, none have been confirmed yet.
In summary, the market remains in a positive position, with key indicators pointing towards continued strength. Investors should stay vigilant and be prepared to act on any confirmed signals that may arise.
