The S&P 500 has bounced back this week after experiencing a sharp pullback last week.  Below is our trading range chart of the S&P over the last year.  As you can see, the index surged in October but stalled right when it got close to its prior highs seen in May.  This proved to be stiff resistance and sellers indeed stepped in after bulls couldn’t quite make a push to new highs.  The index was also at two standard deviations above its 50-day moving average (the top of the red zone) when it peaked, and typically rallies run out of steam when they get that overbought.

We weren’t surprised at all to see a pullback last week after such a sharp rally, and it’s bullish that we’ve bounced back this week instead of further breaking down.

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Below we provide our trading range charts for the ten S&P 500 sectors.  There’s still plenty of upside room to run in the near term for most sectors.

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