The S&P 500 rallied again in the early hours on Monday, and therefore looks very much like it is going to be “steady as she goes” in the near term.
You can see that the S&P 500 rallied a bit during the trading session on Monday, and it looks like we are trying to break towards the 5300 level, which was a major barrier that we could not get past last time. Keep in mind that the S&P 500 is not an equal weighted index, so it will only be a handful of companies that drive everything. It’s all the usual suspects.
Short-term pullbacks should be buying opportunities going forward, and we should look at them as such. The 50-day EMA sits underneath and is right around the 50-100 level, so I think that’s your floor. But the hard floor, the even more important floor, is the 5,000 level.
If we can break above the 5,300 level, then it’s likely that we go looking towards the 5,500 level, possibly even the 5,600 level. In general, this is a market that I think continues to see a lot of choppy volatility, but I still think every time you get an opportunity, you should be a buyer of any value that occurs.
There’s very little in the way of economic announcements on Monday, so that might be part of why we drifted a little higher, but on Tuesday and Wednesday, we start with PPI and CPI in America, which obviously will have a major influence on where we go next. Really, at this point in time, I think Wall Street has made up its mind. It’s going to continue to pump stocks, and that’s just the end of it.
For a look at all of today’s economic events, check out our economic calendar.
Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.