The stock market was modestly lower last week with fresh data pointing to slowing economic growth, as I pointed out in the latest Market Week show. The S&P 500 (SPX) fell 10 points to 2952, a decrease of 0.3%.

Key US economic data released last week missed analyst expectations, including the Purchasing Managers Index, which came in at 47.8, indicating a contraction compared to the previous month. Two separate measures of job creation also missed expectations.

S&P 500 (SPX) Daily Chart 

Our approach to technical analysis uses market cycles to project price action. Our analysis is for the SPX to begin to roll over, within the context of its current minor cycle. Even after rallying for two days, it still has negative momentum. The SPX is currently trading in our short term resistance zone, from 2950-2960.

30-Year Bond Futures (/ZB) Daily Chart 

Bond futures were up 1.5% last week, initially moving higher as the stock market moved lower, but then continuing to rise as stocks recovered. Does this continuation signal that bond traders are doubtful of the Thursday-Friday optimism in the stock market?

The 30-year bonds are clearly still in the rising phase of their current cycle. They made it through our resistance zone and even pierced the top before retreating. This positive momentum has us wondering if they might make a move towards the previous high of 166’25”. Yet our call is for a small down week, as traders digest the strength of the last week.

For a more detailed analysis of both of these charts, check out the latest episode of the askSlim Market Week show.