Christopher Lewis
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The S&P 500 has done very little in the electronic trading session, as the underlying index of course was closed. With Wall Street being closed during the trading session on Monday, you cannot read too much into what happened during the session, but when you look at the overall charts, you can see that the market has been very bullish for quite some time, and I do not see that changing anytime soon.

S&P 500 Video 06.07.21

Underneath, we have the 50 day EMA sitting right at the 4200 level, and of course the uptrend line sits just below there and offers support as well. All things being equal, the market is likely to continue to see lots of bullish pressure, as the Federal Reserve does everything it can to keep the markets afloat. Ultimately, this is a market that I think continues to see plenty of buyers on dips, so therefore simply waiting for value is probably the best way to go going forward.

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On the other hand, if we were to break down below the uptrend line, the market would then go looking towards the 4000 handle, which is where there is a significant gap. Furthermore, there would be a significant amount of psychological importance built into the 4000 handle, so I look at that as a major “floor in the market”, which should hold. If it does not though, I would not be a seller, I would be a buyer of puts because at least then you can mitigate your longer-term risk. Having said all of that, I think that any drop below the 4000 level will probably be met by the Federal Reserve protecting Wall Street.

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