S&P 500 will face a test ‘sooner or later,’ BTIG analysts say

© Reuters. S&P 500 will face a test ‘sooner or later,’ BTIG analyst says

BTIG analysts raised questions about whether the is poised for a significant dip below the prior week’s low after failing to surpass the previous week’s high for the first time in 2024.

In addition, it witnessed a 3-day decline for the first time since January 4 and hasn’t touched its 50-day moving average (DMA) since last November.

“This isn’t bearish medium-term and it’s far from the longest streak on record, but it is getting up there and so a test is likely coming sooner than later, in our view,” the analysts said in a note Sunday.

The most recent NAAIM Exposure Index reached its highest level since November 2021, signaling another “change in tone.”

Meanwhile, the semiconductor sector is exhibiting signs of weariness, and with the approach of April—a month historically negative for the SOX index in 8 of the past 10 years—investors are taking note of these emerging trends.

Energy and Materials, on the other hand, have been the best-performing sectors over the last month, outperforming all others by a substantial margin, the analysts highlighted.

“This is occurring as commodities are broadly improving. Since the end of 2021, Energy is still by far the best-performing sector (+63% vs. +22% for tech), and second best over the last month,” they wrote.

“Despite that, we get the sense that interest in the group is quite low here. Should it break out from multiyear resistance, we think interest will pick up,” said the analysts.