End of Day – 6/10/2021

Big picture, we are closer to the end of this run than the beginning. That is for sure. You can draw that 5th Wave wedge previously discussed in these pages on the daily S&P 500. That would potentially get us a move higher into the 4250ish area – that would be my bull case. The NASDAQ 100 would likely be testing its all-time highs in the circumstances.

There is simply tension between all of the sectors keeping the picture mixed. The Financials look bad today – no surprises with interest rate spreads compressing. The industrials like Caterpillar and Deere are correcting. A vote on stalled infrastructure negotiations? Health care (XLV) looks great – maybe one of the best charts I have seen in a while – but the returns may not be what we are accustomed to in tech. But tech is not fairing badly either today.

How about this; if we close above 4235 on the S&P 500, I would see a continued, yawning grind higher as we saw earlier today. If we close back inside the balance range and below that level, I will shift to “prove it to me” with the bulls.

It is late here, so I am signing off for the night, comfortable taking no position until the picture clarifies.

As of this moment, the NASDAQ 100 is not much above our exit point yesterday, and that is a bit disappointing for a “breakout.” Maybe the close will be more pleasing.

Internals have deteriorated steadily from the open, another disappointment. This morning really looked like the market could do the trick. So far, my contrarian stance was warranted, and that is a bit of a surprise too.

A.F. Thornton