Long-term uptrend due for an extended pause, says Fairlead's Stockton on S&P 500

Core Viewpoint - The S&P 500 is on track for its best week since June, but the market may not have enough strength to reach previous highs before a potential retrenchment [1][4]. Market Analysis - The current market is viewed as a B-wave in an ABC corrective phase, indicating that the recent rally is interrupting a correction rather than marking its end [2]. - There has been a significant loss of intermediate-term momentum across major indices, despite the recent oversold bounce [2][3]. - The S&P 500 is currently around 6550, with the next support level approximately 6 to 7% below this point [3]. Resistance and Breakout Potential - The final resistance level for the S&P 500 is around 6910, and a decisive breakout above this level would be considered a bullish development [4]. - New highs would be favorable, but confirmation through sustained levels above those highs is necessary [5]. Investment Strategy - It is recommended to use the current relief rally to reduce exposure to high beta stocks that have shown a loss of momentum, as indicated by the 20-day moving average [6].