S&P 500 to Dip Out of Bull Market as 30-Year Rate Nears 5%: What's Next?

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data point. Now, rates are at a point where the economy will start to slow, and financial conditions are finally tightening.There is no reason it couldn’t get there. This spread tops when the 10-year is 3% above the 2-year. Now, I’m not trying to suggest that the 10-year is going 8%, but what it tells us is that if the 2-year doesn’t start to come down at some point, there could be a lot more the 10-year can rise from here, and that would bring a lot of pain to equities.

The index filled the gap at 4,220, effectively wiping out the entire summer rally. The 4,200 mark is crucial. Not only is it where the 200-day moving average resides, but dropping below 4,200 also means the S&P 500 no longer boasts a 20% gain from the October 2022 lows. It’s worth considering how many investors might grow anxious if the 200-day moving average is breached and the index is no longer in a “bull market.

4200 is a big technical level and a very big psychological level, and if that breaks, I would think things get worse. Obviously, if you get weak job data on Friday and rates collapse, stocks will snap back. So suddenly, Friday’s job report just became a whole lot more important.was down over 1.8% on the day, it’s in a bit better technical shape than the S&P 500 but not by much.

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