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There’s a real good Bull/Bear macro-tug of war going on out there all of a sudden. There is a core constituency of bulls who want to believe that the current pattern of US economic growth is going to sustain itself and then there are the bears who remain negative on both the US Dollar and the SP500 for the intermediate term TREND.

There was plenty of economic data this morning for both bulls and bears to tug on:


  1. In the chart below we show a modest sequential acceleration in the ISM Non-Manufacturing Index (54.3 in July vs. 53.8 in June)
  2. MBA mortgage applications were up +1.5% week-over-week (barely budging demand levels not seen since 1997)
  3. ADP’s employment report came in at 42k (better than expected) 


  1. ABC/Washington Post weekly consumer confidence dropped for the 5th consecutive week to -50 versus -48 last week.
  2. II’s Bullish/Bearish Survey widened to +6 points in the Bulls favor (Bears dropped to 33% and this is a contrarian indicator).
  3. The SP500 remains below the Bear Market Macro line of resistance (1144). 

Coming up next are US Retail same store sales reports (tonight and tomorrow), weekly jobless claims (tomorrow), and Friday’s unemployment report for the month of July. My immediate term TRADE lines of support and resistance for the SP500 are now 1116 and 1131, respectively.

Keith R. McCullough
Chief Executive Officer

Bull/Bear Macro-Tug - 1