- During the trading session on Tuesday, we saw the S&P 500 rallied quite nicely, which started overnight in electronic overseas trading.
- Traders continue to look to the 6150 level, which was the all-time high a bank in the springtime.
- That being said, there is a massive amount of noise out there, and it has a lot of influence on how the market chooses to behave.
- While we are bullish, there are a lot of things out there to be very cautious about.
External Factors
There are a world of external factors out there worth paying attention to, not the least of which would be the war between Israel and Iran. The cease-fire being signed of course is a step in the right direction, and that has some traders looking to get “risk on” as that was announced. This influences the S&P 500, and it was essentially an excuse to continue the bullish behavior from the day before. Short-term pullbacks could be a reality here, but unless something changes drastically, it more or less should end up being a buying opportunity.
Another external factor worth paying attention to is the fact that Jerome Powell spoke in front of the US Congress during the session, but he essentially said old the same things he’s been talking about for a while. In other words, he did not “upset the apple cart” through his testimony, and the markets are probably breathing a little bit of a sigh a relief due to that.
If we do pull back, I expect the 6000 level to be important enough to attract a certain amount of buying pressure, unless of course we get a situation where traders continue to be bombarded with negative headlines around the world. The consumer confidence numbers came in a little lighter than anticipated, so that of course has a little bit of a minor effect on this market, but after about 10 minutes, the market turned its attention toward Jerome Powell.
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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.
