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Christopher Lewis
S&P 500

The S&P 500 has broken a bit higher during the trading session, gaining ever so slightly to break above the 3850 handle. However, it looks as if we are running out of momentum which makes quite a bit of sense considering that we have been on an upward trajectory in ad infinitum. I believe that the 3800 level underneath should continue to be supported, but right now Wall Street is waiting to see how much “cheap money” it is about to get. After all, we are in the midst of earnings season and that might be the excuse to sell off the S&P 500, but the end result is to throw a big enough tantrum to make the Federal Reserve step in. Unfortunately, this is a beast of the Federal Reserve is making, and it is now something that they have to live with.

S&P 500 Video 22.01.21

To the downside, I see the uptrend line in the 50 day EMA as both potential support levels, and areas that I would be willing to jump in with a bigger position. In the meantime, I do think that buying dips does typically work but we are getting a little bit stretched at this point so at the very least we may have to kill a little bit of time. To the upside, I still believe that we are going to try to get to the 4000 level, but it is not going to be easy to get there, and there will of course be the occasional head fake along the way.

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