Oil-Energy Lead – Utes Hit Bullish Zone – Small-caps Correct – Breadth Takes a Hit

Breadth deteriorated since mid August as the percentage of stocks above their 200-day SMAs fell the last few weeks. New highs also dried up as SPY stalled and small-caps fell. So far, this is deemed a correction within a bullish environment. The models are still net bullish and the recent deterioration has yet to trigger bearish signals. Elsewhere, 2 and 10 year Treasury yields continued to rise and hit 52-week high. Yield spreads remain narrow and show no signs of stress in the credit markets.