While the stock market is coming off one of it's best months in over 30 years, I can't get the idea of the "flattening the curve" out of mind. Yes, the S&P 500 gained +12.7% for April, its third-biggest monthly gain since World War II. The Dow gained +11.1%, its fourth-largest post-war monthly rally, and its best month in 33 years. Not to be outdone, the NASDAQ outpaced both the DOW and S&P 500 by posting a monthly gain of +15.5% for April, that's its biggest one-month gain since June 2000.
All of that sounds great, right? But even with these big monthly gains, we are still roughly -16% off the record high for the S&P 500, and if you take a look at the weekly charts, you'll see that the stock market is flattening the curve.
On a weekly level, all three indexes will post weekly losses, for the second week in a row. Talk about stumbling across the finish line. Clearly, all the gains were made in the early part of April before the earnings season ramped up.
As for the other markets that we watch, the US dollar will post a weekly loss; it's first in three weeks, triggering a new red weekly Trade Triangle indicating a move to a sidelines position.
Gold is having its troubles trying breakout above the 1,750 level, losing -2% on the week and continuing a pattern of flip-flopping weekly gains and losses.
Crude oil and Bitcoin are the darlings of the week as far as weekly gains go, but volatility continues to rule the crude oil market. However, it will post a weekly increase of +16%, trading back above the $15 level.
Bitcoin will post it's fourth straight week of gains with a +15% gain, but it still has some work to do next week if we're going to see that new green monthly Trade Triangle indicating a move to a new long position.
Overall, I still think the stock market is flattening the curve when it comes to price action, and there may be some pain in our near future.
Key Levels To Watch Next Week:
- S&P 500 (CME:SP500): 2,721.17
- Dow (INDEX:DJI): 22,941.88
- NASDAQ (NASDAQ:COMP): 8,035.95
- U.S. Dollar (ICE:DX): 98.81
- Gold (NYMEX:GC.M20): 1,737.90
- Crude Oil (NYMEX:CL.M20): 15.45
- Bitcoin (BITCOIN:BITSTAMPUSD): 6,472.67