Warren Pies: Bullish Technical Signals Point to New S&P 500 All-Time Highs

Bullish Technical Signals for S&P 500

• 💡 Warren Pies of 314 Research identifies numerous technical signals that suggest the S&P 500 is poised to reach new all-time highs this summer.
• 📈 The strategy relies on analyzing price action and technicals to navigate policy and event risks, believing in the wisdom of collective market behavior.
• ✅ The Dow closing above its 200-day moving average is cited as a positive indicator for the broader market rally.

Contrarian Indicators and Institutional Positioning

• 🧠 Retail investors have been actively participating by buying dips, which has surprised many and contrasted with institutional behavior.
• 📉 Institutional money remains underinvested and appears to have been caught off guard by the V-shaped recovery, a historically bullish sign.
• ⚠️ CTAs (Commodity Trading Advisors), a major trend-following group, are still short the market, indicating significant room for upside.
• 📊 The AD line making new all-time highs ahead of the market is another strong bullish development.

Small Caps and Economic Cycle

• ⚠️ Pies advises against owning low-quality small-cap companies in a late-cycle environment, preferring them at the early stages of an economic cycle when the Fed is stimulating.
• 🚀 The current environment is characterized by decelerating economic growth, not the early-cycle conditions favorable for small caps.

Navigating Tariff Risks

• ⚠️ While acknowledging tariff windows closing over the summer as a significant risk, Pies believes the market's collective wisdom will prevail.
• 🎯 He suggests that potential resolutions to trade disputes are more predictable than other market risks, as they are influenced by actors with self-preservation instincts.
• 💬 The market often needs a "wall of worry" to climb, and current concerns are preferable to unpredictable external factors.