A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Thursday, Feb. 11, 2016. Global equities tumbled toward a bear market, with the Dow Jones Industrial Average plunging to 400 points, as financial markets signaled that investors have lost faith in central banks' ability to support the worldwide economy. Photographer: Michael Nagle/Bloomberg
© Bloomberg

On May 20 it will be a full year since the S&P 500 last hit a new high.

Following the intraday record of 2,135, there have been a couple of sharp drops and two pacy rallies, and now we are back in what frustrated bulls may refer to as a period of consolidation.

Crucially, in terms of technical factors, at least the S&P 500 opened Tuesday’s session above both its 200 and 50-day moving averages.

Providing those levels are held — around 2,013 and 2,047, respectively — then bulls will maintain hope the rally is not done.

Yet, if virgin territory is to be claimed, then its likely the market will need leadership from technology and/or financials.

The Nasdaq Composite has underperformed the S&P 500 by about 6 per cent over the past 12 months, weighed down by Apple closing last week at its lowest since the middle of 2014.

The KBW Bank index is down more than 11 per cent over the past year as meek economic activity and a flattening bond yield curve continues to hit sentiment toward the sector.

The KBW at the start of this month once again failed to move above its 200-day moving average, as Strategas Research points out.

Meanwhile, positioning data show speculators are net long S&P 500 E-mini futures for the first time in more than a year.

This means that, if short covering was an important driver of the latest bounce, it is now over to the bulls to push the S&P 500 higher from here.

chart S&P 500 e-mini contracts

jamie.chisholm@ft.com

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