This dip that we are seeing on Monday could very well be an opportunity to find value.
S&P 500 Consolidates as Markets Digest Higher Rates and Risk
The S&P 500 has gone back and forth during the trading session on Monday as we are a little overdone at this point, and I think a little of a pullback probably makes a certain amount of sense. That's especially true now that interest rates are rising again, as we're right around the 4.5% level on the 10-year yield.
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Ultimately, I think this is a market that if we do pull back from here, the 7500 level is a major floor in the market, as it had been a major resistance barrier. Over the longer term, I still plan on seeing the S&P 500 reach the 7700 level, and I do think that it's a market that can get there, but I also recognize that it may take some time.
Interest Rates and Geopolitical Noise
This market is going to be one that I think remains noisy. I think it does remain bullish overall, but I also recognize that it remains somewhat sensitive to the interest rates, as interest rates are jumping around due to a lot of different things. Not the least of which would be the fact that the noise in the Middle East continues to be a bit of a problem.
People don't really know what to do with it as the Iranians have now said they're shutting down the Strait of Hormuz, which will be opened by the US Navy eventually, and basically leading us towards more conflict. That does have a little bit of risk appetite coming out of the market.
But really, all of the same things that have been driving S&P 500, specifically artificial intelligence, probably continue to be a major driver as to where we go next. So, I think this dip, or potential dip at least, could be a nice buying opportunity.
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