S&P 500: Approaching All Time Highs
Back Above 6000
The market ended the week ticking most of the boxes on the bullish wish list—even as the “administration bromance” stirred up fresh headlines:
The S&P 500 reclaimed the psychological 6000 level
Breadth remained supportive, with more stocks making new highs than new lows
Risk-on barometers ARKK and IWM both registered breakouts
My outlook remains unchanged: a constructive advance toward new all-time highs, with ARKK positioned for outperformance in this phase of the rally. That speculation has played out well through last week, and it remains the default view unless all three risk-off criteria are triggered.
On a related note—I'm watching Tesla closely to see if the bromance breakup develops into a longer-term trade opportunity.
About the Risk-Off Signal
The purpose of the risk-off signal isn’t to predict a specific drop—it’s to alert when the market’s character changes.
When all three of my signals—trend, breadth, and momentum—turn negative, it means conditions are vulnerable. Sometimes that leads to a sharp drawdown (like February’s 19% decline), and other times it results in a mild 4% pullback. It’s not about calling every tick—it’s about avoiding exposure through the worst stretches.
This system helps shift from offense to defense at the right moments—so the next trade can be made from a position of strength.
A Reminder for Readers
This is the first Sunday note of the month and is free to all readers. The midweek Lines After Dark update and remaining Sunday letters are reserved for supporting subscribers.