Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
S&P 500: recovery and reconquest?
Information is not investment advice
Finally, the stock market is seeing better days. After having peaked at 3 960 two weeks ago, the S&P went into a fortnight plunge. It dropped as low as almost 3 800 in the beginning of this week. However, since then, it recovered most of the losses crossing all the MAs above 3 900.
What we have to do now is to watch the support of 3 900 and the MAs around it. It’s advisable to hold and abstain from entering the market so far. If the index crosses this formidable support downwards, that would mean that the bearish potential is not exhausted, and we are yet to see more downtrend.
Otherwise, the S&P will bounce from the support upwards – in this scenario, it will likely cross 3 960 to finally challenge 4 000 forming a new uptrend.
- Wait for the 3 900 support to either get crossed downwards or send the index upwards
- Buy if the S&P bounces upwards
- Sell if the S&P crosses 3 900, 100-MA, and 50-MA downwards
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates? Recall that the Federal Open Market Committee had previously ended the year 2022 with a 50bps hike, and an indication from Powell, the committee chairman, that the Fed could consider raising interest rates by 75bps in the course of the year 2023.
Western countries are trying to find other options for oil and gas supplies after a 10th package of sanctions, which will put more pressure on Russian oil and decrease global oil supply. Italy, for example, is in talks with Libya.