- As market players continue to turn to the Federal Reserve for guidance, the S&P 500 is still trading close to its highs.
- Wall Street continues to believe that the Federal Reserve is there to save them at this moment.
We're essentially treading water in the electronic trading session, so the S&P 500 hasn't moved much overnight. It's evident that the market is extremely bullish right now, and I doubt that anyone can deny that, but ultimately, it all depends on your strategy. Are you searching for value or are you willing to chase the S&P 500?
In my opinion, value is ultimately how you ought to handle things. This market is in need of some sort of correction because it has grown by roughly 25% over the past few months. Even while a retreat to the 5,000 level would be extremely slight, it would represent a significant round number that many would be observing. Therefore, you must bear that in mind. At that moment, I believe a lot of investors might be interested in going long.
Fed Cuts Coming? Yes.
Much of this is determined by whether or not the Federal Reserve will make cuts this year, which they most definitely will. This year, stocks should see a slight increase because they want to reduce their interest rates by three times. Where do we enter is the question at hand. And once more, I believe that the 5,000 level would be a great place to be, but if we break above 5,100, people will probably start purchasing without hesitation because they are experiencing FOMO once more.
The 50-day EMA becomes interested in anything below the 5,000 level, and finally it moves up to the 4,800 level. To be honest, there are just a few stocks that influence the market regardless, thus I have no interest in shorting it. That means that all you actually need to do is watch those stocks and utilize this as an ETF, provided that you also keep an eye on the so-called Magnificent 7. Ultimately, there are approximately 493 stocks on the market that receive little to no attention. These are the realities of life here.
If we have enough time, I do believe we go higher, but you must exercise caution. It is not advisable to pursue the trade blindly. Having said that, you must trade this market as though there is a strong bullish trend.
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