The S&P 500 Breakout the Market Waited For
For two months the market was stuck. Triangles, head-and-shoulders tops, and a steady fear of falling kept everyone watching for a break in either direction. This week the waiting ended, and it broke to the upside.
All three major US indexes now sit above every one of their moving averages and turned higher together. The S&P has reshaped from a symmetric triangle into an ascending one and is pressing toward a new record, closing in on the June 2 high near 7,620 after its long climb from the March low at 6,316. The VIX fell to 15, deep in the calm zone. The clearest tell that this is about positioning and not headlines: the Iran ceasefire officially collapsed the same week and the market did not flinch, while a falling gold price says inflation fear is draining away.
Underneath, it is a rotation, not a mania. The scary head-and-shoulders tops on Nvidia and the mega-caps proved to be false alarms, and profit taken in AI names is moving into the Dow and other non-AI stocks rather than leaving for gold or crypto. That is why the Dow keeps grinding higher and cash stays inside US equities.
The one warning: even Daniel Yue calls this a confirmation signal, not an invitation. Most small investors bought months ago and are low on cash, so the move may be more crowded than it looks, and it still has to clear the record to count.
The focus of the market today: a genuine upside breakout across all three indexes, with the S&P a step from a record high, forming while the world looks the other way.
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About the Author
Daniel Yue has been an active investor since 1980, with experience spanning stocks, currencies, futures, metals, and bonds. A scholar of the Chicago School of Economics, he holds a Certificate with Distinction from Cambridge University and a degree in International Trading from National Taiwan University. He served as Chief Analyst for over 30 years and Chief Mentor at Sincere Finance. In 2017, he received an award from the University of Arizona for financial internship leadership.
The analysis and opinions expressed in this article are for educational purposes only and do not constitute financial advice. Investing involves risk. Please consult a qualified financial advisor before making investment decisions.
About the Author
Daniel Yue has been an active investor since 1980, with experience spanning stocks, currencies, futures, metals, and bonds. A scholar of the Chicago School of Economics, he holds a Certificate with Distinction from Cambridge University and a degree in International Trading from National Taiwan University. He served as Chief Analyst for over 30 years and Chief Mentor at Sincere Finance. In 2017, he received an award from the University of Arizona for financial internship leadership.
The analysis and opinions expressed in this article are for educational purposes only and do not constitute financial advice. Investing involves risk. Please consult a qualified financial advisor before making investment decisions.