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Christopher Lewis
S&P 500

The S&P 500 has been very noisy during the trading session on Thursday, showing signs of a bit of an overbought condition. We are just above the 200 day EMA, and that of course will attract a lot of attention. The 3000 level above is a major psychological barrier, so if we were to break above there it would obviously shoot the market much higher. Ultimately, this is a very noisy marketplace and therefore you have to be overly cautious about your position size. Ultimately, this is a market that I think is trying to break out but quite frankly has no business to from an economic standpoint.

S&P 500 Video 22.05.20

Having said that, Wall Street is more concerned about the flow of money from the Federal Reserve than anything else. If it continues to get bailouts, it will continue to try to grind higher. Ultimately though, the market is going to continue to see a lot of noise regardless, so at this point I think it is a scenario where buying dips may make some sense but clearly we need to pullback in order to offer a couple of things, not the least of which would be momentum, and of course the value that would be needed. In fact, a pullback to the 2840 level would be just about ideal, but right now we do not have the necessary momentum to do anything. As we drift into the weekend, keep in mind that it is a three-day weekend we are facing so do not be surprised at all if we do truly little in the Friday session.

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