Many chart analysts don’t trust this stock market comeback. Here's why

Wall Street just had its best weekly performance of the year. The S & P 500 popped 3.4% in the holiday-shortened, four-day week that just ended, as traders grew hopeful that the U.S.-Iran war would soon come to an end. The Dow Jones Industrial Average and Nasdaq Composite also showed strong weekly performances. Yet, many chart analysts don’t think the stock market is done falling — advising investors to stay cautious. “We believe it is too premature to declare victory for the bulls and continue to view the bounce in the context of an oversold correction until our trend work improves,” wrote JC O’Hara, chief market technician at Roth Capital Partners. O’Hara pointed out that the S & P 500 is now within reach of its 200-day moving average (DMA), a key technical level it breached to the downside in mid-March. The S & P 500 ended Friday’s session at 6,582.69. The 200-day moving average, which smooths out day-to-day fluctuations, sits at 6,647.60, about 1% above Friday’s close. Jonathan Krinsky of BTIG also said the S & P 500 lacks “the fully oversold conditions that typically accompany a breach of the 200 DMA,” meaning there’s more downside ahead. “Over the past 20 years, SPX has rallied 4%+ over two days following a sub-30 [Relative Strength Index] 13 times, as it did last week. Yet only one of those instances began with more than 30% of components above their 200 DMA. It has also spent 10 consecutive trading days below its 200 DMA while being within 7% of a 52-week high — a combination that has never occurred in the past 20 years,” wrote Krinsky. The chief market technician added that the S & P 500 could fall as low as around 6,000-6,150, “as long as we remain below ~6800.” Katie Stockton, founder of Fairlead Strategies, also thinks the market isn’t oversold enough for her to call a bottom. “We don’t have extremes that we’d like to see in breadth or sentiment ,” Stockton told CNBC’s " Squawk Box " on Monday. “When we look at these oil shocks that we’ve had, historically, it’s not great for the market, and it actually has some duration to it. So, we want to respect that.”