The S&P 500 continues to see a lot of noise at this point in time, as we are looking at a range still playing out.
The fact that we are “still standing” probably says more about the market than anything else.
The S&P 500 initially dipped during the trading session on Thursday, but then turned around to show signs of life as we are sitting just above the 50-day EMA. This is leading to a bit of a hammer, which is flying in the face of the shooting star that we formed mainly after the Federal Reserve decision to hold rates, but sounded somewhat hawkish yesterday.
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Keep in mind that two out of 12 members did vote to raise rates
You'll notice the S&P 500 has essentially been going sideways for what seems like an age here. With that being said, I still think we're basically stuck between 7,600 and 7,800, with more emphasis on upward momentum.
Rates are drifting a little bit lower during this trading session, so that helps as well. But it's also worth noting that foreign inflows into the stock market are stronger than usual. Of course, earnings season is going on at the moment as well.
With all of that happening at the same time, I anticipate a lot of volatility and choppiness. But I'm looking for a breakout to the upside because, with all of the bad news that is out there and the elevated rates - until recently, when we started to see rates drift a little bit lower - the stock market just remains. That suggests that there's at least enough underlying demand to keep it somewhat buoyant.
It's not very exciting. It's not very pretty, but I think the S&P 500 from here remains a buy-the-dip market. I remain slightly bullish at this juncture, but not willing to commit massive amounts of money.
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