In this week’s market update, S&P 500 weakness remains the dominant theme as the index continues trading below its widely watched 200-day moving average — a level many institutional traders use to gauge the market’s long-term trend.
Chief Trading Strategist Blane Markham noted that the breakdown below this key support level has been accompanied by a concerning technical pattern: the market is now forming lower highs and lower lows, a classic sign of a developing downtrend.
When markets fall below major technical levels like the 200-day moving average, it often signals that institutional money may be reducing exposure. As a result, volatility typically increases and short-term price swings become more unpredictable.
Market Breadth Shows Underlying Weakness
Another factor reinforcing the current S&P 500 weakness is the deterioration in market breadth.
According to Markham’s analysis, only a small percentage of stocks remain in short-term uptrends. When fewer stocks participate in rallies, it suggests that the broader market may lack the momentum needed to sustain upside moves.
This narrowing participation can often precede additional volatility or further downside pressure in the near term.
Volatility Driven by Geopolitics and Energy Markets
Adding to the uncertainty are ongoing geopolitical developments and fluctuations in energy markets, both of which have been contributing to sharp price swings across major indices.
For traders, this environment often leads to whipsaw price action, where markets move quickly in both directions. While this can be challenging for investors focused on longer-term positions, it can also create opportunities for disciplined traders who rely on structured strategies and technical signals.
Trade Opportunities Still Emerging
Despite the broader market weakness, selective opportunities continue to appear.
One recent example highlighted in the update was a bearish setup in Affirm (AFRM), which generated strong gains for members of the alert service. Situations like this demonstrate that even during volatile or declining markets, well-timed trade setups can still emerge.
This is why many professional traders focus less on predicting the overall market direction and more on identifying high-probability setups as they develop.
Watch the Full Market Update
To see the charts, key technical levels, and trade opportunities Blane Markham is currently tracking, watch the full market update below.
👉 Watch the full market update here:
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⚠️ Disclaimer: This content is for educational purposes only and should not be considered investment advice. Trading involves risk and is not suitable for all investors. Past performance is not indicative of future results.