The positive action in the stock market last week was crucial for turning the trend upward. Of course, we need to see a bit of follow-through these next couple of weeks with higher highs and higher lows.
Still, the bulls have made a stand here and that would be the low from the prior week, let's call it 4953 on the S&P 500 chart. That is now our low for this cycle, and the longer the S&P stays above there the better chance it will move away from that support level, and see moving averages race towards it.
A pullback or correction within a larger uptrend is quite normal and healthy, though it can be a bit unsettling when it is happening — much like feeling an earthquake. Our first instinct is to be careful, cautious and fearful; these are natural emotions that overwhelm us when uncertainty reigns. The future move in the stock market is uncertain but we can feel better about things because over time it is the best place to build wealth.
The indicators are starting to turn upwards on the weekly chart but we need to see more time pass and better price/volume action. Leading up to Memorial Day weekend we should have a clearer picture.