(MENAFN– Daily Forex) The S & P 500 has gone back and forth during the trading session on Monday, as traders continue to weigh whether or not stock markets should be going higher or lower. There are lot of questions about the bond market right now as yields are rising, this is generally thought of as being negative for stocks. That being said, this is a market that very clearly has been in an uptrend for quite some time and could just simply be trying to consolidate a bit in order to figure out where the next narrative comes from.
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The previous trendline is offering a bit of resistance in the short term, but at the end of the day it is going to be the 4500 level that everybody cares about. If we can break above there, then the S & P 500 is likely to continue the overall long-term trend that we have seen for some time. The 4500 level is more than likely going to be a major options barrier as well, so we can break above there it is a good sign. On the other hand, if we were to take out the lows of last week, that would be very negative and could have me buying puts in a market that simply cannot be shorted . (The central banks are far too manipulative of this market to actually consider it a“market.”)
Buying on the dips has been the only way to trade this market over the last 13 years and I simply do not see that changing anytime soon . Higher interest rates have caused a little bit of hesitation, but the think that the market is suddenly going to sell off it is a bit of a dream, because even“high interest rates” on the two-year is going to be something along the lines of 2.00% at the moment. In other words, there still extraordinarily low in historical terms.
At this point, I think the market is much more likely to see 4600 than the 4200 level, but if we do break down that will be my target as far as puts are concerned. The 200 day EMA sits just below there, and it would represent about 8% or so as far as a correction is concerned, something that is very healthy in an uptrend to begin with .
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