FXEMPIRE
All
Ad
Advertisement
Advertisement
Christopher Lewis
Add to Bookmarks

The S&P 500 has rallied a bit during the course of the trading session on Tuesday as traders are looking to pick up a bit of value. Interestingly enough, bond yields fell significantly, which is a little bit counterintuitive, as the bond and the stock markets are diverging. It is worth noting that the 50 day EMA and the uptrend line have collided and held as support. All things being equal, we are still very much in an uptrend but if we break down below the lows of Monday, it is likely that we could see an acceleration to the downside.

S&P 500 Video 21.07.21

If we do break down, the 4200 level would be a target for support, but we could break down below there as well. At that point, we would more than likely go looking towards the 4000 level which is a large, round, psychologically significant figure, where we have also seen a little bit of a gap. I also believe there is probably a massive amount of options barriers sitting there, as it would represent a 10% drawdown from the highs. That is a simple correction, something that the market probably has needed for a while.

Advertisement
Know where the Market is headed? Take advantage now with 

Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

On the other hand, if we take out the losses from the trading session on Monday, then it is possible that we could go looking towards the 4400 level. This would simply be a continuation of the overall uptrend, as the Federal Reserve does everything it can to keep the markets afloat, and I do think that will probably end up being the way that the market behaves in general. Remember, it is almost impossible to short these indices as they are so manipulated and are not equally weighted.

For a look at all of today’s economic events, check out our economic calendar.

Advertisement
Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker