The markets have started the month with a powerful, largely cyclical, rally. What’s missing is a significant breakout: Only 10% of the S&P are at new highs, despite a historic high for that index. Part of the reason is a big move-up in the largest stocks. Six of the seven biggest stocks in the S&P 500 are outperforming the index this month, including Apple, Alphabet and Amazon.

That may be about to change.

The S&P 500 fell 0.12% to 3,074.62 however, as under-performance in real estate and utilities sectors capped gains in the broad market. The financial sector was the best-performing group among 11 S&P 500 sectors as yields continued to rise on trade-deal hopes. Bank of America was up 1.3%, while J.P. Morgan rose 0.2%.

The S&P 500 is up more than 20% this year, and if history is any gauge, this is bullish for stocks through year-end. A run of this magnitude also bodes well for 2020.

When the S&P 500 is up 20% or more through October, as it is now, the average return through the rest of the year is more than 6%, according to Canaccord Genuity, which tracked market returns back to the 1950s. This has happened seven times in that period. The median return was 5.92% and all seven times led to gains the rest of the year.

Plan A : Short if market failed to support above 3063.50. Targets are 3048.50, 3035.25 and 3026.75.

Plan B : Long if market retraced but supported firm above 3030.50. Targets are 3045.25, 3053.75 and 3064.25.  

U.S. stock futures were pointing to a higher open on Wall Street on Tuesday on optimism about U.S.-China talks surrounding their “phase one” trade deal.

The Nasdaq Composite Index was little changed at 8,434.68 or +0.02% weighed down by a 1.6% loss in Netflix shares. 

Stocks in Asia were mixed on Wednesday as investors monitored developments on U.S.-China trade. Mainland Chinese stocks declined on the day, with the Shanghai Composite down 0.43% to about 2,978.60. The Shenzhen Composite slipped 0.868% to approximately 1,641.23 while the Shenzhen component shed 0.78% to 9,860. Hang Seng Index was slightly lower, as of its final hour of trading.

Elsewhere, the Nikkei 225 in Japan closed 0.22% higher at 23,303.82, with shares of index heavyweight and robot maker Fanuc advancing 1.17%. The Topix index finished its trading day largely unchanged at 1,694.45.

Meanwhile, South Korea’s Kospi closed slightly higher at 2,144.15 while the S&P/ASX 200 in Australia declined 0.55% to end its trading day at 6,660.20.

Plan A : Short if market failed to support above 8192.50. Targets are 8152.50, 8125.25 and 8095.50.

Plan B : Long if market retraced but supported firm above 8096.50. Targets are 8136.25, 8162.50 and 8190.50.

HSI

Hong Kong stocks rose for a fourth straight session on Tuesday, helped by hopes of more stimulus to arrest cooling growth on the mainland and the island city and signs of progress in Sino-U.S. trade talks.

Plan A : Above 28090, do nothing
Plan B : Below 27411, do nothing
Plan C : Attempt to long if market declines but does not fall below 27497
Plan D : Cut below 27411
Plan E : Consider to short if market does not breach above 27694
Plan F : Cut above 27780