Monday's selling took the S&P down 0.8% and the Nasdaq 0.9%. The 10-year is back to 5.24% this morning and the 30-year to 5.57%. The weekly readings are still red. The S&P is at -87 equal weight and -22 cap-weighted, with 46 names breaking out against 270 breaking down. The Russell is at -62 and -24. The Nasdaq is barely positive at +1.8.
The daily pulse turned this morning. On the S&P it's +22 equal weight and +104 cap-weighted, with 153 names breaking out on the day against 73 breaking down. That's a bounce starting. It isn't a signal yet.
What makes this one worth watching is who's buying. The five-day average of insider buying to selling is at its highest in six months, heading into quarter-end. It spiked the same way at the end of March, when the market was at its darkest. Momentum turned about a week later, and the S&P ran 12% in 13 sessions.
The equal-weight S&P (RSP) is the chart to watch. It's holding the 38.2% retracement of its run at $209, with the 200-day and the 50% level stacked at $205 to $206 right underneath. RSI is 33. A push back over its 8-day and 20-day is the turn. A break under $205 opens up $200.
Two things can get in the way first. Pension funds rebalance into quarter-end, and with stocks up on the quarter and bonds down, that means selling stocks and buying bonds over the next two days. Then PCE at 8:30 tomorrow, and Micron after the close. JOLTS is at 10 this morning.
