The S&P 500 was negative in the early part of the session on Thursday, as we continue to see a lot of problems with the Middle East, and the interest rates skyrocketing haven’t helped either.
S&P 500
The S&P 500 has fallen pretty significantly during the trading session here on Thursday, breaking the bottom of what would be thought of as a potential ascending triangle. And breaking below the 50-day EMA, that, of course, is a market signal that isn't exactly great.
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But that being said, this is a market that looks as if it is going to continue to see buyers on dips, at least based on the reaction so far. Longer term, though, we have to ask the question as to whether or not this triangle isn't a thing of the past and whether or not we are just going to go sideways. The 7,300 level is offering support based on market memory. We'll have to wait and see how this plays out, but it looks like we are trying to form more of a rectangle.
Middle East Risk and Rising Yields Pressure Equity Support
With the noise coming out in the Middle East, it makes a lot of sense that we will continue to see a lot of concerns out there. Interest rates are jumping, and that doesn't help either. Ultimately, though, we are in the midst of earnings season, so maybe that helps the S&P 500 sooner or later? Maybe, but there are so many things going on that it will remain noisy.
As things stand right now, this is a market that I think remains noisy, choppy, perhaps a little erratic. VIX numbers are climbing, but I also look at this as a potential buying opportunity. Not with a big position, but for more longer-term minded folks. If we were to break down below the 7,200 level, then maybe some things change.
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