Chart of the Day - Friday, March 14, 2025

🏆 Today's Chart of the Day was shared by Larry Thompson (@HostileCharts).
 

• The S&P 500 was headed for its worst week since 2020 yesterday. However, it bounced +2.1% on Friday, marking its best day since the election. It still fell -2.3% this week, but last week was worse (-3.1%). 
   
• The weekly candle (not shown) printed its largest lower wick since July 2022, signifying a bullish reversal. Larry points out that the last few days could be a bear trap if $SPY reclaims former support at $565 next week. 
   
• Sentiment and seasonality suggest a bottom is near. However, Larry notes that breadth and momentum are lacking. Less than 30% of stocks are above their 20-DMA, and RSI printed its most oversold reading since the 2022 bear market low, confirming yesterday's low rather than diverging.
   

The Takeaway: The S&P 500 avoided its worst week since 2020, thanks to Friday's bounce. The bounce could have legs if $SPY reclaims $565 next week. However, trend, breadth, and momentum remain damaged.