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The S&P 500 currently on track to wipe out losses for the year. We are now higher for 2025. What do the market technicals signal about the health of this rebound? Joining us now, we've got Jeff Buchbinder, LPL Financials Chief Equity strategist. Jeff, a great time to talk to a technicals person. I really appreciate you being on with us here because I want to know what everyone wants to know. Is this year-to-date now gain on the stock market going to hold?

Yeah, well, thanks for having me on. First of all, I do fundamentals and technicals. So I'll get that out there first. There are some very positive technical signs here. Uh, for one, you know, that massive move yesterday certainly, we saw about 90% of stocks above their 20-day averages on the S&P 500, very positive technical signal. And of course, which everybody's talking about, we are above the 200 day on the S&P 500. So, generally speaking, that's a positive signal, especially if you're coming off of a big downdraft. Perhaps the most positive piece of this is that it's going to drag the the technically driven trend followers back into the market. There's some big institutional money that's coming back in. We've already seen reports of those dollars moving in. That can actually allow these gains to hold.

Jeff, of course, your expertise knows no bounds. You can talk fundamentals, you can talk technicals, but I'm interested in the technicals at the moment because of exactly what you said here. And one thing I'm curious about is, at what point do we start to see selling get triggered if the rally is apparently overdone to some investors? What might that look like?

Sure. Well, you know, we we've been looking at this 5,800 level as key technical resistance. There are a lot of reasons for that. Previous highs, previous lows, as well as near the the 200 do moving average. Markets are pricing in a lot of optimism right now. In fact, you know, we at LPL have been telling our clients, we've gone from peak tariffs and max uncertainty to clarity and trough tariffs. So think about that. In a very short period of time, essentially we're pricing in the best case scenario. We're on top of the wall in terms of the wall of of worry that stock markets climb. And so in the very short term, we do think we need to pull back a little bit, digest these gains, and, uh, you know, perhaps see the market be a little bit less complacent and start pricing in the risks. We've got still sticky inflation, although the CPI news was positive. We have potentially a little bit of a an up move in rates, which of course can drag on stock valuations. And then these tariffs, you know, if 10% holds, that's certainly good news overall. Uh, but if we see those tariff rates creep up to maybe 15% overall, that's not so positive. Markets pricing a lot of good news right now.

And Jeff, my guest host, Lou has a question for you.

Jeff, I'm a fundamentals first guy and mostly, but I do pay attention to technicals. And I'm just curious. I'm not sure if you were one of them about a month ago, everyone was freaking out over the S&P 500 Death Cross, which fast forward to today and really wasn't that deadly. How do you decide what technical indicators are the most important for investors to follow? What from your vantage point, what are the strongest technical indicators to follow?

You know, to that, I would say breadth, right? And so I cited one stat in terms of the percentage of stocks above the 20 day. Uh, we also like to compare the moves to prior historical moves. And so this move actually resembles some of the really big reversals in the past. You can look at 1987. You can look at 1998. You can look at 2011. Right? Probably have to take out some of these bad recessions, not very comparable. Uh, we don't think we're going to have a recession this time. But some of those big moves certainly resolved higher.