The S&P 500 monthly is showing a positive close above last month’s highs and near new highs. Until the market shows signs of topping or sustained selling, the monthly outlook remains bullish.

The S&P 500 monthly is showing another close above the upper keltner line. This is the first negative monthly close in five months. Until the market shows sustained weakness, the monthly outlook remains bullish.

The S&P 500 monthly is showing another close above the upper Keltner line. This month also marks the end of the first half of the year, which ended 110 points above the opening range.

In the event the market continues upward, 2138 should be tested, while a sell off could retest 1820 or lower.

The monthly outlook remains bullish.

Saw this post over at the TAMU Real Estate Blog, and found it interesting in comparison to all the bearish rhetoric I’ve been seeing lately.

The following is the St. Louis Fed leading index for the USA.

Does it correlate or at least lead the S&P 500?

The blue line is the S&P 500, while the red is the leading index. There is a very close correlation between the recent bear / bull markets on the S&P 500.  A monthly close below 1 on the leading index suggests a recession is coming, while above 1 suggests economic expansion. The leading index has stayed above 1 since October 2010.

The index does lead the S&P 500 by a few months, however, it hasn’t correlated this much until the 1990s.

• Larger Chart Graphic
• Leading Index / S&P 500 Excel

The S&P 500 monthly is showing another positive close on the monthly chart. So far, only 1 month out of the year has closed negative, while the last 4 have all closed up. Until the market shows sustained weakness, the monthly outlook remains bullish.