Some sentiment measures have overheated, and we think the market needs a technical reset. The five-day CBOE equity-only put/call ratio (P/C) hit 0.47 on Tuesday, matching the low from January 22 when the market was topping earlier this year. This is the lowest reading since April 2022, which was after the initial counter-trend rally during the 2022 bear market. Prior to that, the five-day P/C is at its most optimistic level since coming out of COVID-19 in the second half of 2020 and during 2021, when stocks were strong.

Operating in the Eastern United States, Class I railroad CSX generated revenue of nearly $14 billion in 2025. On its more than 21,000 miles of track, CSX hauls shipments of coal (16% of consolidated revenue), chemicals (17%), intermodal containers (16%), automotive cargo (7%), and a diverse mix of other bulk and industrial merchandise.

Operating in the Eastern United States, Class I railroad CSX generated revenue of nearly $14.5 billion in 2024. On its more than 21,000 miles of track, CSX hauls shipments of coal (16% of consolidated revenue), chemicals (17%), intermodal containers (16%), automotive cargo (7%), and a diverse mix of other bulk and industrial merchandise.

The major stock indices remain in a short-term downtrend, with an ongoing series of lower highs and lower lows. The S&P 500 (SPX), at its pullback low on March 30, had given back 635 points (or 9.1%) from the January 27 all-time closing high. The SPX (at 6,583) remains slightly below its flattening 200-day simple moving average at 6,645 and well below its declining 50-day average up at 6,783. Both of these moving averages had offered support, but now represent potential resistance. Since mid-January, we have observed above-average volume on declining days, signaling institutional distribution. While the S&P 500 bounced late last week after the 14-day Relative Strength Index (RSI) dipped below 30% and cycled into minor oversold territory, significant overhead resistance remains. The SPX recently broke through chart resistance from the November 20 low, but faces additional chart resistance at 6,721 from the December 17 low. Additionally, the rally was recently capped by the 21-day exponential moving average and an initial 38.2% Fibonacci retracement of the recent decline. On the downside, the recent closing low of 6,344 for the SPX is initial chart support. The current danger for the index is that the next piece of strong chart support does not come in until the 6,000 to 6,140 region (the prior breakout zone traced out during the February to June 2025 bullish base). The near-term technicals remain precarious and we need a lot more evidence to suggest the decline is over and that we have started the process of tracing out a bottom. (Mark Arbeter, CMT)