Despite a pullback in early February, U.S. equities were trading positive for the year. So where does Wall Street go now that the threat of a market correction has faded some?

After surging more than 8% in six days to their widely watched 50-day moving average from their 200-day moving average, U.S. stocks look "poised to consolidate their recent gains," Fundstrat wrote in a Feb. 21 note.

At the closing bell on Friday, Feb. 16, stocks registered their best weekly performance since 2013. But by the close of the next trading session on Tuesday, Feb. 20, stocks finished in the red.

Sentiment is varying as many on Wall Street were looking for a break to new lows. But Fundstrat analysts said their expectation is that any pending pullback in stocks will be limited to a support band near the S&P 500's 100-day moving average, or down about 2.5% from current levels to 2,650, coinciding with a 50% retracement of that rebound that took place last week.

But regardless of further pullback, the threat of a pivot to bear sentiment seems unlikely. The bull market cycle appears to still be in good health, Fundstrat said.

"While the market's reaction to key technical levels is almost too perfect/text book, we continue to view the recent correction as a pullback within an established bull market and unlikely the beginning of a much longer-term cycle peak," analysts noted.

According to Fundstrat, the four-year market cycle that began in early 2016 will see new stock highs in 2018 with "a more serious corrective window opening through 2019."

For the time being, risk appears to flow mostly from the threat of rising interest rates.

"Despite the positive long-term/secular relationship between equities and rates below 5%, equities have reacted negatively to rates moving above the 2017 highs at 2.64%," Fundstrat wrote. "A move above the January 2014 highs at 3.03% would likely lead to further equity weakness."

Markets are watching closely Wednesday ahead of the release of minutes from the Federal Reserve's meeting last month. The minutes could provide the first tidbit of insight as to new Chairman Jerome Powell's plans for hiking interest rates.

Fundstrat said that following the recent market surge "the list of timely new ideas has meaningfully contracted given most stocks rebounded with the broader market indices."

But many secular names were ahead of the pack in groups including software, services, internet, aerospace and defense and financials.

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