Widening our typical view and looking at weekly charts, we see important signals for both bulls and bears. For the bulls, the S&P 500 (SPX) bounced back and has recaptured its 50-week simple average just one week after undercutting this sometime-key support. The index did the exact same thing back in October 2023, and that ignited a huge rally. For the bears, the 10-week exponential moving average (EMA) has crossed below the 21-week EMA. The last time this bearish crossover occurred was in March 2025 at the start of the tariff tantrum. Based on the depth of the completed rounding-top pattern (formed from November 2025 until March), a measured move for the SPX first targets the 6,190 area and then 6,040. These levels align with key support clusters, including the 38.2% retracement of the April 2025 rally (6,180) and the previous breakout level (between 6,000 and 6,140). We believe that the zone between 6,100 and 6,200 is the most logical place for the current decline to stabilize, this because of the cluster of support in that area. Former breakout areas often are tested. The current secular bull market for the SPX began back in 2009, with the long-term bullish channel (log scale) starting in 2011. The lower trendline, formed off the lows in 2011 and 2018 and tested at the end of the 2022 bear market, suggests support near 5,600 by early 2027. A shorter-term trendline off the 2022 and 2025 lows indicates support near 6,000 looking out six months. Meanwhile, the upper boundary of the bullish channel comes in between 7,600 and 8,000, also extending out about six months. (Mark Arbeter, CMT)

Every January, Argus identifies specific investment themes that we think will be relevant in the year ahead. This week, we drill down into our sixth theme for 2026: U.S. Competitive Advantage, Aerospace and Defense. This theme was selected before the war in Iran began. Aerospace and Defense design and manufacturing is a core competencies of the U.S. economy. In our view, the sector is positioned for solid growth over the next few years. Defense spending data for 2024 shows that the United States, China, and Russia are the top three spenders globally, with the U.S. spending nearly $1 trillion. Global military expenditure reached a record high of over $2.7 trillion in 2024. Looking ahead, forecasts call for the industry to grow at a CAGR of 6% through 2028. Drilling down, the global airline industry bodes well for commercial aerospace demand over the next several years. Airline passenger levels and airline revenues are growing at a healthy pace -- and with international markets reopened, we believe the industry will be able to recover a substantial amount of its pre-COVID-19 revenues and profitability into 2027. We also expect solid military spending over the next few years, as U.S. spending accounts for nearly 40% of all global military spending. According to the U.S. Bureau of Economic Analysis, annualized federal spending on national defense was running at an $871 billion rate in 2Q25. That's up 6% year over year. On top of the country's typical strong commitment to defense spending, the budget has been influenced by the ongoing Russian invasion of Ukraine, the current war in Iran, rising inflation, and other factors. The current geopolitical environment should keep spending high for some time to come. BUY-rated stocks from the Argus universe that we think are positioned to take advantage of the trend include the following.

In addition to its legacy software-defined radio franchise, L3Harris Technologies has through a series of acquisitions established franchises producing uncrewed aerial vehicles, sensors, avionics, space-based systems, missiles, and solid rocket motors. It also adapts civilian aircraft for military use and provides military and commercial training services, and maintains the US Federal Aviation Administration's communications infrastructure.

During the final three days of last week, WTI exploded 19%, finishing at $99.30/barrel. Over the past 10 days, crude has skyrocketed 48%. Excluding the pandemic, that was the largest move since our data set began in 1983 and hit levels last seen in 2022. The last few oil peaks were $115 (June 2022), $126 (March 2022), and the all-time high of $147 in 2008. We won't guess where this ends, but the longer prices go parabolic, the sooner we reach a peak (likely followed by a crash). The S&P 500 (SPX) appears to be tracing out a bearish rounding top. An end to the war and subsequent crash in oil should make the pattern null and void. On Thursday, the SPX fell below the December 17 closing low of 6,721 and also took out the key 61.8% retracement of the rally from November 21 to January 28. The next key supports are the 200-day average at 6,604, an 88.2% retracement at 6,579, and then the November 2025 intraday and closing lows in the 6,520-6,540 range. It's hard to find much that is bullish on the daily charts, except that the SPX continues to show resilience after all the negative headlines. Or maybe there is just too much complacency. More concerning is that the index has lost its 21-week exponential moving average, a consistent support during an intermediate- to long-term uptrend. The SPX fell below this average in early 2022, mid-September 2023 (not much downside), and early March 2025. Some 50% of SPX issues are now above their 200-day moving average, with the danger zone being a persistent drop under 45%. The reading for the S&P 100 (OEX) is down to 51% and for the Nasdaq 100 (QQQ) it has declined to a weak 44%. (Mark Arbeter, CMT)