No-Advice Disclaimer: This analysis is for informational purposes only and not a recommendation to buy or sell any security.

Stock Market Outlook: August 23rd =
Uptrend

Author: J.Wenger ---- Published: August 23, 2026 ---- Last Updated: 2026-08-23
Disclosure: The author holds no material positions in the securities mentioned. See Editorial Policy & Disclosures for details.

The stock market outlook still shows an uptrend, even though equities retraced some of the August breakout.

Bitcoin, Healthcare, and High Dividend outperformed; U.S. Equities, Technology, and Momentum underperformed.  U.S. debt was the story and bond market intervention was the response.

TREND ANALYSIS

The S&P500 ( $SPX ) fell 1.4% last week.  The index is:

  • ~2% above the 50-day moving average
  • ~8% above the 200-day moving average
2 of the 3 technical indicators are testing their respective cross-over levels. Trading volume should pick up over the next few weeks as the summer holiday season comes to an end. Technical analysis chart of $SPX showing 6 months of candlesticks with 21-day, 50-day, and 200-day moving averages, volume with EMA(50), ADX(14) with +DI and -DI, and OBV with MA(62) through 2026-03-22.

Technical Analysis – $SPX – 2026-08-23

PERFORMANCE HIGHLIGHTS & COMPARISONS

Asset Classes

Bitcoin ( $IBIT ) roared back to life last week, easily providing the highest gains and jumping back to bullish bias.  U.S. Equities were the worst asset class.  Bitcoin was the worst performer.  Emerging Market Equities moved to bullish bias as well.

Performance comparison of major asset class ETFs ($USO, $IBIT, $GLD, $SPY, $VEA, $EEM, $IEF, $BNDX, $PCY, $DXY) showing 1-week, 4-week, and bias-shift returns relative to the U.S. Dollar.

Asset Class Performance vs. U.S. Dollar – 2026-08-23

S&P500 Sectors

Healthcare ( $XLV ) outperformed other sectors last week, thanks to the gains by Moderna.  Industrials, Technology, and Utilities ( $XLI, $XLK, $XLU ) basically tied for the worst sector.  Both Industrials and Technology also eased to neutral bias.

Performance comparison of S&P500 sector ETFs ($XLC, $XLY, $XLP, $XLE, $XLF, $XLV, $XLI, $XLB, $XLRE, $XLK, $XLU, $SPY) showing 1-week, 4-week, and bias-shift returns.

S&P500 Sector Performance – 2026-08-23

S&P500 Investing Styles

All investing styles were in the red last week; High Dividend ( $SPHD ) was the "best performer", while Momentum ( $MTUM ) was the worst.  Momentum also dropped back to bearish bias, one week after returning to bullish.  Low Volatility and Large Cap Growth ( $SPLV, $IEF ) eased to neutral.

Performance comparison of investment style ETFs ($SPHB, $SPLV, $IWO, $IJH, $IWF, $OEF, $IWN, $IJJ, $IWX, $MTUM, $QUAL, $SPHD, $POWA, $SPY) showing 1-week, 4-week, and bias-shift returns.

Style Performance vs. S&P500 – 2026-08-23

COMMENTARY

Markets

Equities took a backseat to the debt market last week, at least in terms of catalysts (see below).  The big winner, so far, has been crypto, as bitcoin catapulted 20%+ during the week.  Gold prices also rallied, while bonds and the dollar sank, which is the typical response to the interventions we've seen so far this summer.

Macroeconomic Data and Policy

The U.S. national debt passed the $40 trillion mark last week, generating lots of headlines about the deficit and pushing long-term borrowing costs (i.e. yields) higher.  The 30-year U.S. Treasury reached its highest level since June 2007, meaning you have to go back prior to the financial crisis and Great Recession to find rates as high.

In an attempt to reverse the recent trend in long-term yields, the U.S. Treasury Department announced a market intervention (yes, another one).  It will double its maximum buyback per month, from $2 billion to at least $4 billion per operation, running from September 9th to November 4th.  Further action, if needed, will be announced at the next Quarterly Refunding Announcement, also scheduled for November 4th.

The FOMC meeting minutes from July revealed that half of the committee penciled in rate hikes sometime in 2026.

Geopolitics

The formal ceasefire MOU between the U.S. and Iran expired last Monday, without any further progress.  Traffic through the Strait of Hormuz remains limited, keeping the pressure on oil prices.

Trade negotiations between the U.S. and Canada collapsed on Friday, leading the Trump administration to place 50% tariffs on certain Canadian goods.  The following day, Prime Minister Mark Carney declared that Canada is "at war" with the U.S. economically and announced retaliatory, dollar-for-dollar tariffs (effective September 8).

President Trump also signed an executive order, aimed at reducing food prices.  The U.S. plans to import up to 300,000 metric tons of ground beef, tariff-free, with importers agreeing to drop the price 25% below current market rates.

EYES ON THE HORIZON

Key decision-making data, in the form of PCE  and GDP, comes out midweek.  It's also the week of the FOMC's annual meeting in Jackson Hole, so there's light week of economic data, with the only "real" catalyst related to the last FOMC meeting.

And we've just added a speech from US Treasury Secretary Bessent on Monday afternoon to navigate.

  • Monday: Bessent Speech
  • Tuesday: --
  • Wednesday: July PCE, Q2 GDP (2nd Estimate)
  • Thursday: --
  • Friday: Warsh Speech, Annual NFP Revisions
Best to Your Week!

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Content Sources: Bloomberg, CNBC, Federal Reserve Bank of St. Louis (FRED), Hedgeye, StockCharts.com, TradingEconomics.com, U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics.
Price and Volume charts provided courtesy of stockcharts.com.

Performance Methodology: All sector performance data is sourced from ThinkorSwim and reflects price‑only returns calculated using end‑of‑week closing data. Bias classifications follow a proprietary Invest Safely, LLC model and update only when trend conditions meet predefined thresholds. All calculations are consistent across every chart on this page.

Disclaimer: Invest Safely, LLC is an independent investment research and online financial media company. Use of Invest Safely, LLC and any products available through Invest‑Safely.com is subject to our Terms of Service and Privacy Policy.


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Not a recommendation to buy or sell any security.

Looking for more information on the Stock Market Outlook Signals? You'll find it here:

In the past, I reviewed market outlook signals as if they were a mechanical trading system, while pointing out issues and making adjustments. The goal is to give you to give you an example of how to analyze and continuously improve your own systems.

For historical Elliott Wave commentary and analysis, go to ELLIOTT WAVE lives on by Tony Caldaro.

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