Weekly Update Podcast for May 27-30, 2025

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Summary of the What to Watch Update for Tuesday, May 27, 2025:
Overview: The update addresses recent market news, particularly tariff concerns impacting the S&P 500, and evaluates positive, negative, and watchlist indicators amid a mixed market environment.
Positive Signs:
S&P 500 Support Levels: The index remains above the June pivot point (5775), aligning with longer-term chart support, and above the 200-day and 50-day moving averages.
Growth vs. Value: Intraday S&P growth-to-value ratio is holding steady, with mid-cap and large-cap growth-to-value ratios above moving averages. The QQQs (NASDAQ 100) to S&P and discretionary-to-staples ratios are also above the moving averages.
Technical Indicators: The advance-decline line, while declining, remains above the moving averages. Individual investor sentiment has slightly improved from extreme negative. The vortex indicator is positive (green line above red), and the Landry Lite and proper order indicators remain positive. Stocks above 50- and 100-period moving averages are still above 50%. Weekly parabolic SAR and intermediate-term momentum are positive.
Other Indices: NASDAQ 100, Wilshire 5000, and total US stock ETF are above their 200-day moving averages. The NASDAQ 100-to-Dow ratio is positive, and momentum stocks continue to trend upward.
Negative Signs:
Market Performance: The S&P 500 experienced a down week, with a significant gap lower on Monday after a Moody’s US debt downgrade, followed by a "buy the dip" rally that faded. Late-day selling on Thursday and tariff news on Friday added pressure.
Volatility and Sentiment: The VIX is above 20, signaling negative returns, with its momentum turning upward. The Investors Intelligence survey is negative but improving, still below the positive threshold of 2.
Technical Weakness: Indicators Such as the high-beta-to-low-beta ratio, advance-decline ratio, and McClellan Oscillators (S&P and NYSE) showed negative divergences before declining below zero. The TTM squeeze, short-term trend indicators (MACD, PMO, PPO, TRIX, KST), and bullish percent indices are rolling over. The daily parabolic SAR is negative, and stocks above their 200-day moving average in the S&P are below 50%.
Sector and Ratio Weakness: Semiconductors, homebuilders, transports, and regional banks are showing declines. Ratios such as discretionary-to-staples, tech-to-utilities, and semis-to-Dow are weakening. The 10-year yield above 4.5% and Japan’s 10-year yield above 1.5% (raising carry trade concerns) are adding pressure. International stocks are outperforming US stocks, but emerging markets are lagging developed markets.
Areas to Watch:
Economic Indicators: Jobless claims are stable but watched for signs of a breakout, which could signal recession risks. The unemployment rate (4.2%) and upcoming employment report are key.
Bond and Stock Ratios: The spread between risky and non-risky bonds is narrowing (positive), but stock-to-bond ratios (e.g., S&P to 3-7 year bonds) are weakening. Inflation expectations (TIPS ratios) show no major concerns yet.
Global Markets: The German DAX hit a recent all-time high, and the US-to-German stock ratio is declining, indicating US underperformance.
Other Factors: Oil prices remain in the low 60s, the US dollar is under 100 and in a downtrend, and the 10-to-2-year and 10-to-3-month yield curves are not inverted.
Conclusion: Despite tariff concerns and a negative market week, the S&P 500 is holding above key support levels, with some positive technical and sentiment indicators. However, negative momentum, rising yields, and sector weaknesses warrant caution.

PDF of Charts and Slides used in today's video:
https://drive.google.com/file/d/1xIfaBceEchqmkUbO1jwqOD8GQijAKrGR/view?usp=sharing

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DISCLAIMER This video is for entertainment purposes only. I am not a financial adviser, and you should do your own research and go through your own thought process before investing in a position. Trading is risky!