Charted Market Insights - May 27, 2026

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Charted Market Insights - 27 May 2026 - SPX, NDX, RSP, and IWM plus high yield OAS and bre. Download • 2.93MB

SPX, NDX, RSP, and IWM plus high yield OAS and breadth

SPX: 7450-7490 target zone tested with eyes on 7650; support from 7333 to 7273

The S&P 500 (SPX) rallied to another record high yesterday, spending the entire session above 7500. With the 7450–7490 target zone for the mid 2025 breakout achieved, the SPX sets its sights set on 7650 (mid-April breakout target and 61.8% extension). The May 19 low at 7333 and the May 6 upside gap at 7294–7273 provide risk management supports after the sharp 19.4% rally from the late-March low. Below the gap, the next major support zone does not emerge until the prior highs at 7002–6920 and the rising 26- and 40-week moving averages (WMAs) at 6946–6848.

SPX market breadth improves but a new high on the A-D line remains elusive

Market breadth has improved. The SPX volume advance-decline (A-D) line pushed to a new high, finally confirming the mid-April breakout above 7000 on the SPX. The spread between 52-week highs and 52-week lows surged to +43 yesterday, giving this indicator breathing room above key support at -21 to -27 (August 2025 and March 2026 lows). While the SPX A-D line has yet to break to new highs and confirm the rally above 7000 on the SPX, it has improved since mid May and may be forming a bullish ascending triangle pattern.

RSP: Cup and handle breakout intact above 205, targeting 213.59 and 221-223

The Invesco S&P 500 Equal Weight ETF (RSP) is breaking out from the bullish cup and handle flagged in our May 7 The Chart Check. Since the RSP reflects the performance of the “average” S&P 500 stock, sustaining this breakout would bode well for market breadth. Holding 205 would keep the breakout intact and favor upside toward 213.59 and 221.28-223.00. If RSP fails to hold its breakout point, the handle lows at 199.70-198.73 offer additional support.

High yield OAS benign and narrows to lower low, confirming SPX rally

The U.S. high yield option adjusted spread (OAS) narrowed to a lower low to provide bullish confirmation for the SPX rally from its late-March low. Lower credit spreads mean benign credit markets, which is a risk-on signal. Sustaining the push below the May 6 narrow at 2.75 would place the focus late-January trough at 2.64. The May 19 peak at 2.86 on the U.S. high yield OAS provides a tactical risk management level that coincides with nearby support at the May 19 low at 7333 on the SPX.

NDX above targets from 28,324 to 29,500; new gap support at 29,753-29,663

The NASDAQ 100 (NDX) has continued to rally, surpassing upside targets at 27,700 (mid-2025 breakout count), 28,324–28,798 (extension levels), and 29,500 (October-April bullish consolidation target), with the next major upside projection not until 32,481 (100% extension). Yesterday’s upside gap at 29,753–29,663, the eighth upside gap during the index’s 31.5% rally from the late-March low, provides tactical risk management support.

NDX breadth solid: New highs for A-D line and net 52-week highs

The NDX A-D breadth and A-D volume lines are stronger than the corresponding SPX breadth measures. The NDX A-D line has hit new highs to confirm the new highs on the NDX. While the A-D volume line has stalled since May 11, it is holding at a high level. In addition, the spread between 52-week highs and 52-week lows has surged to confirm the NDX rally from its April 2025 low.

IWM: Big base with targets at 305 and 327; mind the upside gap at 287.74-286.60

The iShares Russell 2000 ETF (IWM) remains within a solid trend after breaking higher from a late 2021 into late 2025 big base and retesting that breakout earlier this year (Mar. 26 The Chart Check). The mid-April breakout to all-time highs refreshed the bulls and established a tactical upside target at 305, while the 2021-2025 big base projects to 327. The immediate key for IWM is holding this week’s upside gap at 287.74-286.60 as first support ahead of the mid-April into late-May breakout and retest zone at 271.60-268.96 (prior highs from January and February).

Russell 2000 A-D volume line remains strong after bullish breakout and retest

We continue to view the A-D volume line on the Russell 2000 as an important breadth indicator for small caps. Volume often leads price and a big breakout for the small cap A-D volume line provided a bullish leading indicator for a big base breakout on IWM (July 8, 2025, The Chart Check). The mid-to-late-April breakout and retest pattern for this indicator confirms a similar tactical breakout and retest for IWM, reinforcing a bullish setup for small caps. 

S&P 500 (SPX)

SPX: 7450-7490 target zone tested with eyes on 7650; support from 7333 to 7273

The S&P 500 (SPX) rallied to another record high yesterday, spending the entire session above 7500. With the 7450–7490 target zone for the mid 2025 breakout achieved, the SPX sets its sights set on 7650 (mid-April breakout target and 61.8% extension). The May 19 low at 7333 and the May 6 upside gap at 7294–7273 provide risk management supports after the sharp 19.4% rally from the late-March low. Below the gap, the next major support zone does not emerge until the prior highs at 7002–6920 and the rising 26- and 40-week moving averages (WMAs) at 6946–6848.

Chart notes

• 7450–7490 = the upside count for the mid-2025 breakout target and the 100% extension of the October 2022–February 2025 rally projected from the late March low.

• 7650 = mid-April breakout target and the 61.8% extension of the April 2025–January 2026 rally projected from the late March low.

Chart 1: S&P 500 (SPX): Weekly chart (left) and daily chart (right)

Source: Optuma, Suttmeier Technical Strategies

S&P 500 breadth

SPX market breadth improves but a new high on the A-D line remains elusive

Market breadth has improved. The SPX volume advance-decline (A-D) line pushed to a new high, finally confirming the mid-April breakout above 7000 on the SPX. The spread between 52-week highs and 52-week lows surged to +43 yesterday, giving this indicator breathing room above key support at -21 to -27 (August 2025 and March 2026 lows). While the SPX A-D line has yet to break to new highs and confirm the rally above 7000 on the SPX, it has improved since mid May and may be forming a bullish ascending triangle pattern. See Charts 2, 3, and 4 below.

Chart 2: S&P 500 (SPX) (top) and advance-decline volume line (bottom): Daily chart

Source: Optuma, Suttmeier Technical Strategies

52-week highs catch their “breadth” vs. 52-week lows

The spread between 52-week highs and 52-week lows on the SPX surged to +43 yesterday, giving this indicator breathing room above key support at -21 to -27 (August 2025 and March 2026 lows). This support contained the mid-May drop to -20 before a much-needed improvement in 52-week highs relative to 52-week lows. In addition, the 10-day moving average of this breadth indicator has started to turn higher following a brief probe below zero, which is encouraging.

Chart 3: S&P 500 (SPX) (top) and 52-week highs vs. 52-week lows (bottom): Daily

Source: Optuma, Suttmeier Technical Strategies

Dissecting the moves in the SPX A-D line

The SPX A-D line declined from late April into mid May to reflect weakening breadth as the SPX rallied from 7100 to 7400 ahead of a tactical pullback, but it has risen sharply on improving breadth alongside the SPX rebound from the May 19 low at 7333. This improvement in breadth reinforces 7333 as tactical support.

Chart 4: S&P 500 (SPX) (top) and advance-decline “breadth” line (bottom): Daily chart

Source: Optuma, Suttmeier Technical Strategies

S&P 500 Equal Weight ETF (RSP)

RSP: Cup and handle breakout intact above 205, targeting 213.59 and 221-223

The Invesco S&P 500 Equal Weight ETF (RSP) is breaking out from the bullish cup and handle flagged in our May 7 The Chart Check. Since the RSP reflects the performance of the “average” S&P 500 stock, sustaining this breakout would bode well for market breadth. Holding 205 would keep the breakout intact and favor upside toward 213.59 (100% extension of the October 2022-November 2024 rally projected from the April 2025 low) and 221.28-223.00 (61.8% extension of the April 2025 to February 2026 rally projected from the late March low and pattern count). If RSP struggles and fails to hold its breakout point, the handle lows at 199.70-198.73 offer additional support.

Chart notes

• The rising 13-and 26-WMAs at 199.10-198.50 reinforce tactical chart support.

• Rising 26- and 40-WMAs from 198.50 to 195.01 reflect a bullish trend for RSP.

• In our view, absolute upside for the RSP would bode well for the average SPX stock and market breadth, increasing the potential for new highs on the SPX A-D line (Chart 4 above).

Chart 5: Invesco S&P 500 Equal Weight ETF (RSP): Weekly chart

Source: Optuma, Suttmeier Technical Strategies

Credit spreads

High yield OAS benign and narrows to lower low, confirming SPX rally

The U.S. high yield option adjusted spread (OAS) narrowed to a lower low to provide bullish confirmation for the SPX rally from its late-March low. Lower credit spreads mean benign credit markets, which is a risk-on signal. Sustaining the push below the May 6 narrow at 2.75 would place the focus late-January trough at 2.64. The May 19 peak at 2.86 on the U.S. high yield OAS provides a tactical risk management level that coincides with nearby support at the May 19 low at 7333 on the SPX.

Chart 6: S&P 500 (top) and BofA Merrill Lynch High Yield OAS (bottom): Daily chart

Source: Optuma, Suttmeier Technical Strategies, Federal Reserve Bank of St. Louis

NASDAQ 100 (NDX)

NDX above targets from 28,324 to 29,500; new gap support at 29,753-29,663

The NASDAQ 100 (NDX) has continued to rally, surpassing upside targets at 27,700 (mid-2025 breakout count), 28,324–28,798 (extension levels), and 29,500 (October-April bullish consolidation target), with the next major upside projection not until 32,481 (100% extension). Yesterday’s upside gap at 29,753–29,663, the eighth upside gap during the index’s 31.5% rally from the late-March low, provides tactical risk management support. A decisive break below this gap could signal upside exhaustion. Beneath that level, the May 19 higher low at 28,567 and the May 6 upside gap at 28,208–28,065 offer additional support ahead of major support at 26,182–25,835 (prior highs and the mid-April breakout level), along with the rising 13-, 26-, and 40-WMAs between 26,518 and 25,478.

Chart notes

• 28,324 = 100% extension of the October 2022-February 2025 rally projected from the late March low.

• 28,798 = 61.8% extension of the April 2025-January 2026 rally projected from the late March low.

• 32,481 = 100% extension of the April 2025-January 2026 rally projected from the late March low.

Chart 7: NASDAQ 100 (NDX): Weekly chart (left) and daily chart (right)

Source: Optuma, Suttmeier Technical Strategies

NASDAQ 100 breadth

NDX breadth solid: New highs for A-D line and net 52-week highs

The NDX A-D breadth and A-D volume lines are stronger than the corresponding SPX breadth measures. The NDX A-D line has hit new highs to confirm the new highs on the NDX. While the A-D volume line has stalled since May 11, it is holding at a high level. In addition, the spread between 52-week highs and 52-week lows has surged to confirm the NDX rally from its April 2025 low. See Charts 8 and 9 below.

Chart 8: NASDAQ 100 advance-decline line (top) and NASDAQ 100 advance-decline volume line (bottom)

Source: Optuma, Suttmeier Technical Strategies

Net 52-week highs reach +20 to confirm NDX rally from April 2025

The spread between 52-week highs and 52-week lows on the NDX surged to +20 yesterday, which confirms the NDX rally from its April 2025 low. In addition, the 10-day moving average of this breadth indicator remains firmly within positive territory.

Chart 9: NASDAQ 100 (top) and 52-week highs vs. 52-week lows (bottom): Daily

Source: Optuma, Suttmeier Technical Strategies, National Association of Active Investment Managers

iShares Russell 2000 ETF (IWM)

IWM: Big base with targets at 305 and 327; mind the upside gap at 287.74-286.60

The iShares Russell 2000 ETF (IWM) remains within a solid trend after breaking higher from a late 2021 into late 2025 big base and retesting that breakout earlier this year (Mar. 26 The Chart Check). The mid-April breakout to all-time highs refreshed the bulls and established a tactical upside target at 305, while the 2021-2025 big base projects to 327. The immediate key for IWM is holding this week’s upside gap at 287.74-286.60 as first support ahead of the mid-April into late-May breakout and retest zone at 271.60-268.96 (prior highs from January and February).

Chart notes

• While above the 287.74-286.60 weekly upside gap, it represents a bullish breakaway gap. However, a decisive loss of the gap would increase the risk for upside exhaustion.

• Rising 13-, 26-, and 40-WMAs from 266.50 to 255.15 reinforce the bullish backdrop for IWM.

Chart 10: iShares Russell 2000 ETF (IWM): Weekly chart

Source: Optuma, Suttmeier Technical Strategies

Russell 2000 breadth

Russell 2000 A-D volume line remains strong after bullish breakout and retest

We continue to view the A-D volume line on the Russell 2000 as an important breadth indicator for small caps. Volume often leads price and a big breakout for the small cap A-D volume line provided a bullish leading indicator for a big base breakout on IWM (July 8, 2025, The Chart Check). The mid-to-late-April breakout and retest pattern for this indicator confirms a similar tactical breakout and retest for IWM, reinforcing a bullish setup for small caps.

Chart 11: Russell 2000 (IWM) (top) and advance-decline volume line (bottom): Daily chart

Source: Optuma, Suttmeier Technical Strategies

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