Sum
I was bullish for USA stocks but pointed to limited upside in April, and that is how it played out. The rejection/break of NDX, RTY/IWM, EEM, and oil, along with the strength of safe havens TLT and GLD, all show concern for risk assets. That said, VIX and XIV are not so worried and they are right more often than not.
After a relatively mild pullback off 4/20 and 4/27 area highs, valuation and sentiment concerns have eased. I would prefer a deeper drop for risk assets, at least down to MayS1s, but at this point it looks like the market is more likely settling into a range instead of making a sharp decline.
1. Pivots
USA main indexes: Mixed bag with INDU/DIA and SPX/SPY still mostly strong, NYA testing, and NDX/QQQ and RTY/IWM below long term levels. All 5 main USA indexes below MayPs, but didn't tag MayS1s yet.
Safe havens also mixed with TLT and GLD strong above all pivots, yet VIX and XIV both not so worried about the recent drop by being below/above monthly pivot respectively.
On the global indexes, EEM high of year on the YP exact, and FXI leading down.
2. Other technicals
USA main indexes reached overbought or near so about 3 times, and so the natural move was to work off that condition. That happened last week with SPY daily RSI reaching 45 along with tagging a rising D50MA and the lower Bollinger band. I think Friday was more a technical bounce than real buying.
3. Valuation and fundamentals
See recent post and previous tags. As long as there is election uncertainty and concerns about global economic growth I highly doubt institutions will pay above 18x forward earnings on SPX. This means resistance at 2105 according to current data, or just 2.3% upside potential.
4. Sentiment
Per the last Total market view post I warned that sentiment was toppy on 4/7 and 4/21. So far these warnings are proving correct as the market is about sideways since then. The bullish extremes have been worked off on the recent drop though.
5. Timing
There were several timing dates for April, but only 2 for May: 5/9 and 5/26-31. Maybe 5/6 was a low -1 day from the window, we'll see.