Is the U.S. Stock Market Headed for a Deeper Pullback? Fairlead Strategies Warns of Potential Weakness
Today, Fairlead Strategies released a report highlighting potential vulnerabilities in the U.S. stock market, with the at risk of a significant downturn in the near future.
According to the research firm, which specializes in technical analysis, there has been a noticeable decline in short-term momentum, as indicated by the daily Moving Average Convergence Divergence (MACD) indicator. This signals a potential pullback in the coming weeks.
"The SPX's short-term momentum has weakened significantly based on the daily MACD, increasing the likelihood of a deeper pullback within the next 2-6 weeks," the strategists explained in their report.
Fairlead also pointed out that Japan's has experienced a notable drop of over 5% this week, leading to a negative adjustment in short-term indicators. This raises concerns about the Nikkei retesting its key support level around 34,000.
Furthermore, the commodities market has shown signs of a possible rebound, with signaling a potential stabilization above the December low of approximately $69 per barrel. Analysts are closely watching whether WTI can reclaim support near $75 per barrel, as failure to do so could result in a significant downturn.
**Analysis:**
Fairlead Strategies' report highlights potential weaknesses in the U.S. stock market, indicating a risk of a deeper pullback in the coming weeks. The decline in short-term momentum, as shown by the MACD indicator, suggests increased volatility ahead. Additionally, Japan's stock market has experienced a significant drop, raising concerns about a retest of key support levels.
In the commodities market, has shown signs of a potential rebound, but the failure to reclaim key support levels could lead to a significant downturn. Investors should monitor these developments closely to make informed decisions about their investments.
