S&P 500 wrestles with the 50-day MA [HEAT]

Equities rallied on the back of a better-than-consensus number in the ISM survey Wednesday - as expected. But we still believe there will be a string of ugly numbers coming out from the US, and later in the year Europe.

However for the very short-term we need to pass the 50-day moving average in the S&P 500; we find it very likely that this will happen and within a reasonable span of time we are going to test a level around 1100. This would, in our mind, mark a top from where we would be heading lower again. In yesterday’s rally cyclical stocks were amongst the best performing, while defensives where left behind.

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