It isn't much of a short-term uptrend. But the 50-day is upward sloping, and the 5-day is still above the 50-day. It's really just a sideways consolation with a slight upward bias.
 

The number of new 52-week lows is still at a reasonable level. The bullish percents are still ticking higher, although just barely, and the PMO index is still at the top of the range and hasn't turned lower. These indicators all favor the short-term uptrend at the moment.

In Mike Burk's Saturday column, he makes this statement, "Seasonally a significant top usually occurs between late April and early May during the 2nd year of the Presidential Cycle." That sounds about right to me.

In Friday's blog I briefly reviewed market sentiment. I think the sentiment indicators will be important this year.

The Longer-Term Outlook

One way to know where short-term rates are headed is by watching what is happening with the regional banks ETF. This ETF continues to point higher which is an indication that we remain on track for higher short-term rates this year. Higher short-term rates generally indicate economic growth.
 

The stock market leaders are the semiconductors, and this semiconductor ETF continues to point higher. As long as this chart points higher, it favors stock prices for the entire market.

I like this chart. It is a good line in the sand. A monthly close under this moving average simply means something is negative for the general market. Also, a close below the prior month low is a negative signal, particularly if the close is below the moving average.

Here is a look at the yield curve. Anytime that short-term yields exceed longer-term yields, it is time to get very cautious regarding stocks. Some people think that the current bull market is in the clear until we get this inversion again.

With such unprecedented levels of federal debt, I wonder whether we really know how this will play out, and what the yield curve will look like when doubts start to crept in regarding the safety of US bonds.
 

Here is a look at twenty years of SPX earnings with the SPX in the lower panel. This chart presents a really good high-level look at the market.

When the stock market breaks down below the 80-week, you have a pretty serious market correction taking place. If earnings tick lower during one of these severe stock market corrections, then you probably need to be very defensive until prices are up above the 80-week average again.

In general, stocks will anticipate weakness in earnings as in 2001 and 2008. That didn't happen in 2015 when earnings weakened but the market was late responding. Maybe because rates were so low?

Looking at this chart, even after this recent February correction, stock prices are too far above the 80-week average and could correct lower again.
 

A friend of mine told me a few days ago that she has taken most of her money out of the stock market. She said that there has been so much money made in stocks since the last recession that she wants to just be out of the market to make sure she hangs on to what she has made. After looking at the chart above, her words seem very reasonable to me.

Outlook Summary:

Higher rates are now a headwind for US stocks. The recent tax cut, the 300 billion spending increase, and the already out-of-control federal deficit are a set up for a very dangerous spike in interest rates.

Something else to consider is the Mueller investigation. I worry that the headlines generated by the investigation may rattle the markets more than people are currently anticipating. 

I am expecting a choppy, headline-driven, sideways market between now and the November elections.

Mike Burk is looking for a medium-term top between late April and early May, and I think he is probably right.

The long-term outlook is cautious.
The medium-term trend is not sure.
The short-term trend is up.

Strategy:

I have started reducing my risk, and my accounts are now about 60% stocks down from 70%. The remainder is invested in bond funds. New purchases are on hold until the short-term trend corrects down to the bottom of its range.

Buy large cap stocks and ETFs on pullbacks of the medium-term trend.

Buy small cap growth stocks on break outs to new highs during short-term up trends.

Stop buying when the short-term trend is at the top of the range.

Take partial profits when the uptrend starts to struggle at the highs.

Never invest based on personal politics.