Advertisement
Advertisement

Stock Markets Slightly Positive Ahead of the CPI

By:
Christopher Lewis
Published: Feb 9, 2022, 16:38 UTC

The S&P 500 has rallied during the trading session on Wednesday to go looking towards the 50 day EMA ahead of the CPI figures on Thursday.

Stock Markets Slightly Positive Ahead of the CPI

In this article:

The S&P 500 has gapped a little bit higher during the trading session on Wednesday as it looks like traders are betting on a continued consolidation. That being said, the market is likely to continue to see a lot of noisy behavior, and it certainly looks as if Wall Street is trying to push the thing higher. That being said, the market is likely to be very noisy during the course of the trading session on Thursday, as the inflationary outlook is going to be a massive influence on where we go next.

S&P 500 Video 10.02.22

If we turn around a break down below the gap, we could go looking towards the 4400 level, where the 200 day EMA is currently sitting. On the other hand, if the inflationary number is lower than anticipated, it is almost certain that Wall Street will celebrate by breaking through the 4600 level. I think I would be very cautious at this point in time, and it is really not until you get a reaction to the CPI number that you can trade, because a lot of times what Wall Street will do is run a market up ahead of a massive announcement, only to turn around and turn things in the opposite direction.

All things been equal, we are currently sitting between the 50 day EMA and the 200 day EMA, which is typically a sign of compression, meaning that we are ready to go in some type of impulsive move, all we need is a catalyst. Will CPI be that catalyst? That remains to be seen but clearly it is a strong candidate for that.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

Did you find this article useful?

Advertisement