Short-term trend (DAILY CHART) –  SLIGHTLY HIGHER: SPX had a nice run last week from 3972 to 4070, an impressive 98-point gain. In fact, the SPX daily chart suddenly looks strong as it broke above 4000. In addition, SPX is above its moving averages, another positive sign. The big question: How long can SPX remain above 4000? Note: Futures are LOWER on Monday morning.

Long-term trend (WEEKLY CHART) – RALLY. SPX on the weekly chart is still in a trading range but it is pointing higher. Nevertheless, it needs to break above SPX 4200 (approximately) before it's firmly in the clear.

MACD (DAILY) = BULLISH. MACD has broken above its zero line and 9-day signal line on the daily and the weekly. (Note: I switched from monitoring weekly to daily).

RSI: (S&P 500) @64.01 (DAILY) OVERBOUGHT.  After last week's rally, it is not surprising that RSI is reflecting overbought conditions. The higher SPX goes, the higher RSI goes. At 70 and above, it will be in the danger zone (according to RSI).

Comment: Many pros warned of danger last week, but the market had other ideas. It just goes to show how difficult it is to predict market direction, and how important it is to have a trading or investing plan. Without a plan, you are basically susceptible to following random predictions and opinions from many so-called experts.

This market is in a difficult place. Several traders I know have had some of their positions shredded, while many retail investors have stopped paying attention. Eventually, the uncertainty will end and the path will be clear.

In my opinion, although we had a strong week, I personally don't believe we are out of the woods yet. There are too many crosscurrents including inflation, layoffs, and the Fed raising rates. However, one old rule about the market is when everyone agrees which way the market is going, the market does the opposite!

Analyst Lance Roberts, who I follow closely, put it this way in his latest newsletter: "Head Fake or Breakout?" In fact, that is exactly where we are. We could fail to go much higher from this level (i.e., head fake) or in fact move much higher than anyone expects (i.e., breakout).

This week will be busy with the Fed meeting on Tuesday and Wednesday (will they raise by 25 or 50 basis points? Wall Street says 25 basis points.) As Lance Roberts said in his newsletter, and I agree: The Fed meeting this week will determine market direction for the next few weeks.

Note: My latest MarketWatch article is posted here: http://bit.ly/3XIk5fK You can read it on MarketWatch or go to Articles (above) and view the entire column.