- The S&P 500 rallied slightly in the early hours on Thursday, as it looks like the markets are going to do everything, they can to continue going higher.
- This does make quite a bit of sense considering that Jerome Powell didn’t say anything to upset Wall Street.
- With that being the case, I think you have a situation where anytime you get a short-term pullback, you become a buyer yet again.
- Quite frankly, this is a market that is running on momentum right now, and that’s the only thing that matters.
Momentum Continues to Reign
The market has continued to be one that continues to show a lot of momentum, as traders jump in and try to chase the latest move. FOMO trading is a real thing in this market, and therefore think you get a situation where the traders are just simply looking for any opportunity or excuse they can to get involved in the market. Furthermore, the Federal Reserve is likely to continue to cut later this year, perhaps as much as 75 basis points, which is reason enough for Wall Street to blow up the latest bubble.
Keep in mind that the market is only driven on about 6 or 7 stocks, so as long as all of the usual suspects are rallying, this is a market that will continue to go higher. All things being equal, the market still has plenty of support underneath, with the 5000 level being a major floor in the market, especially now that we have the 50-Day EMA hanging around that area. It’s not until we break down below that area that I would be concerned, and even then I don’t necessarily know that the trend would be over, just that we might be more or less trying to find some type of reason to bring in the hot money yet again. Ultimately, the market is one that you cannot short, and therefore you have a situation where the market is one that you will either be sideways, or long. As far as the target is concerned, I believe that the S&P 500 is now starting to have thoughts about breaking above the 5300 level.
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