The S&P 500 rose early on Thursday, as we are trying to turn things around after a massive break lower post-FOMC meeting on Wednesday.
This is a market that looks to recover, and perhaps revalidate the previous action.
The S&P 500 rallied quite nicely during the early part of the trading session here on Thursday, testing the bottom of what had been a nice ascending triangle. The market is likely to continue to see a little bit of market memory here come into the picture, especially considering that the 50-day EMA is sitting just above there. If we can break above there, then the 7,500 level could be targeted, followed by 7,600.
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Market Memory and Post-Fed Reversals
All things being equal, this is a market that could be trying to go back and forth in this overall potential rectangle. The market is likely to be one that I think is moving on the latest news coming from the Middle East, the interest rate markets, and the like. We had the Federal Reserve tank the market—or at least the reaction to the Federal Reserve—only to see it go straight back up in the air.
And that is quite often the way the markets play out; the first reaction is wrong. And now, it looks like we're getting more of the same. Whether or not this ascending triangle holds as resistance, we'll just have to wait and see. Generally speaking, though, this is a market to me at least that looks positive. I have no interest in shorting the S&P 500, and I do like the idea of buying short-term dips despite the fact that the world's on fire. What the market does and what it should do, those aren't always the same thing, so just follow price. That's what I'm doing.
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