{"id":74253,"date":"2025-05-10T22:54:51","date_gmt":"2025-05-11T05:54:51","guid":{"rendered":"https:\/\/drduru.com\/onetwentytwo\/?p=74253"},"modified":"2025-05-10T22:55:06","modified_gmt":"2025-05-11T05:55:06","slug":"cliffhanger-under-200dma-resistance-the-market-breadth","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2025\/05\/10\/cliffhanger-under-200dma-resistance-the-market-breadth\/","title":{"rendered":"A Cliffhanger Under (200DMA) Resistance – The Market Breadth"},"content":{"rendered":"\n

Stock Market Commentary<\/strong><\/h2>\n\n\n\n

The market ended the week on a quiet cliffhanger as major indices hovered under critical resistance levels. A defining theme was the muted reaction to major headlines, particularly around trade and stagflation risks. Despite the looming shadow of stagflation – a term not explicitly mentioned but clearly implied in last week’s Fed meeting<\/a> – the market appears to have settled into a period of indifferent calm.<\/p>\n\n\n\n

This calm was evident in the response to the first trade deal during this pause in reciprocal tariffs. On Thursday, the S&P 500 finished recovering its small Tuesday loss but faded just below resistance at its 200-day moving average (DMA) after news of a trade deal between the U.S. and the U.K.<\/a> The deal was likely easy because the U.S. actually runs a trade surplus with the U.K.<\/a> However, the American Automotive Policy Council (AAPC) was not happy:<\/p>\n\n\n\n

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“We are disappointed that the administration prioritized the UK ahead of our North American partners. Under this deal, it will now be cheaper to import a UK vehicle with very little U.S. content than a USMCA compliant vehicle from Mexico or Canada that is half American parts. This hurts American automakers, suppliers, and auto workers.”<\/p>\n<\/blockquote>\n\n\n\n

News of trade talks with China over the weekend received a muted response from the stock market as well.<\/p>\n\n\n\n

I am also surprised that the overall tone from earnings season has been generally positive. According to an analysis from FactSet<\/a> the tone for the earnings for S&P 500 companies apparently deteriorated. From Q4 to Q1, earnings calls mentioning tariffs jumped from 53% to 93%, and uncertainty from 38% to 87%. Mentions of recession also surged.<\/p>\n\n\n

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Then again, the market does receive periodic boosts from the “Trump put.” On Thursday, the President encouraged Americans to buy stock<\/a> because “this country will be like a rocketship that goes straight up.”<\/p>\n\n\n\n