Morning Notes — SPX

The S&P 500 is bumping into overhead technical resistance at the ~2900 level and still burning off short-term overbought conditions. Meanwhile, equity positioning, sentiment and room for multiple expansion remain highly supportive. Sentiment feels like it improved as the narrative recently shifting from infection/mortality rates to reopening but ‘measured sentiment’ remains decidedly bearish and keeps the balance of risks aimed higher. ‘Overbought’ and ‘oversold’ measure price and time equally. You can see equity markets move between the two on little more than the passage of time. The SPX and many positions have managed to move off extreme overbought levels but more is needed before reaching ‘oversold’, which is always the easiest place to add broad equity exposure. Given nearly unanimous opinion (anecdotal and in the sentiment data), I don’t think we should be looking for and ‘easy’ entry point.