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Christopher Lewis

The stock market has rallied significantly during the trading session on Tuesday, reaching towards the 2375 level but at the same time one should think about the 2400 level as a potential resistance barrier as it has been over the last couple of days. At this point, the market has a lot of noise just above so at this point it makes more sense the sellers would step in. The market could pull back towards the 2200 level at the first sign of bad news, because quite frankly the market still turn around this quickly. This is especially true considering that the US economy is grinding to a halt but eventually we will start to look through all of the headlines and aim for higher levels.

S&P 500 Video 25.03.20

That being said, I don’t think we are there yet, and I see plenty of opportunities for sellers to get involved. Even on a break above 2400 I am still skeptical and believe that the 2500 level would probably be targeted. All things being equal, we are probably going to have to retest the bottom as per usual on these types of bear markets before seeing buyers come around and change the trend. We need to see coronavirus levels drop in the United States, and of course the economic numbers turn around. I do think that most of the worst has been priced in, but to say that everything is going to turn around and instead is clearly being overly optimistic.

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