There are some resilient traders in this market, and the fact that it is at least “hanging in there” as the world crumbles is a strong sign.
S&P 500
The S&P 500 rallied a bit in the early part of the trading session on Wednesday, breaking above the crucial 6,800 level yet again, but we did give some of that back. I think this is the pattern that we’re going to continue to see, quite a bit of choppiness but maybe a little bit of a sour mood.
Resilient Buyers
Despite the fact that there is a massive war going on and of course plenty of concerns about tariffs and maybe now Cuba, who knows, there are some resilient buyers in the S&P 500 and this tells me that this is a market that you might want to pay attention to what’s not happening instead of what’s happening.
And what’s not happening is a sustained selloff of any strength whatsoever. If we turn around and show signs of life, I think ultimately this is a market that I think will continue to go higher, perhaps reaching the 50-day EMA and if we were to break above the 50-day EMA, then we could see the 6,900-level offering a target.
After that, you have the 7,000 level. Breaking above the 7,000 level allows traders to kick off the next leg higher, but ultimately at this point I think we’re just kind of in a choppy bit of malaise. The 200-day EMA underneath the 6,600 level offers support and we did bounce from there just a couple of days ago. All things being equal, I do think that the short-term pullbacks will be buying opportunities and with that being the case I remain bullish longer term, but I recognize you need to be very cautious here I would not put a lot of money into this market.