S&P 500: The S&P 500 bounced off its bear market territory...the rebound may resume if the Fed approves a quarter-point rate hike next week

 


The S&P 500 bounced off its bear market territory (~3,855) during the week, led by the Communication Services (+6.94% for the week) and Information Technology (+5.66% for the week) Sectors. The rebound, however, was not strong enough to take the index above its 600-day EMA, as the weaknesses in the Financial (-6.09% for the week) and Energy (-7.02% for the week) Sectors continue. Silicon Valley Bank (SVB) filed for Chapter 11 bankruptcy on Friday while First Republic Bank may need additional deposit infusions to shore up its balance sheets.

In our view, it's almost a certainty that SVB and First Republic won't be the only casualties if the Fed continues to pursue its rapid rate hiking path to fight inflation. According to the CME FedWatch Tool, the possibility of a 50-basis point hike at the March FOMC meeting is 0%, a 40.2% dive from a week ago.

Keep an eye on the 4,000 level as well as the trendline resistances between 4,050 and 4,115. Beware that the bears will try again to take the S&P 500 down to retest bear market territory next week, though.

This note contained herein is not and should not be construed as a recommendation to buy or sell. Click here to view the latest update!


Comments

Post a Comment

Popular posts from this blog

TESLA INC. (NASDAQ:TSLA): Tesla stock took a deep dive after UBS lowered Q1 EV delivery and gross margin estimates

Image
  Tesla stock tumbled over 15% on Mon day after UBS lowered their Q1 EV delivery estimates from 437k to 367k. UBS now sees Tesla's gross margins shrinking to 10.3%, compared to 16.4%, during the same quarter a year ago.  The bearish "lower-lows" chart pattern resumes after the stock broke the shoulder of the "head-and-shoulders" chart pattern at the end of February , with the price target of $194.81 . Coincidentally, a 60% pullback from its high is $195.42. This note contained herein is our opinion and should not be construed as a recommendation to buy or sell. Click here to view the latest update !
Read more

WTIC Light Crude Oil: WTI crude prices tumble after Goldman Sachs slashes their price forecast

Image
WTI crude prices took a 4.35% dive to close at $ 67 . 12 a barrel on Monday after Goldman Sachs revised down its WTI crude price forecast for December from $89 a barrel to $81, citing increasing supply and slower demand, per CNBC. WTI crude prices could fall further to retest a trendline support at ~ $6 4.30 a barrel if U.S. and China economic data remains soft.  It remains to be seen whether the one million barrels a day oil production cut by Saudi Arabia, starting in July, will have any impact on crude oil prices at this level. This note contained herein is not and should not be construed as a recommendation to buy or sell. Click here to view the latest update!
Read more

TESLA INC. (NASDAQ:TSLA): UPDATE - Tesla stock's downtrend is still intact / Sell $TSLA/Buy $BYDDF

Image
  Tesla stock is under selling pressure after BYD announced on Tuesday that the company will offer its free automated driver assistance system (ADAS) in China on their 21 models. It looks like the smart money is moving out of $TSLA into BYD (OTCPK:BYDDF). BYD stock has already been up 46.27% YTD while $TSLA is down 16.44%. From a technical viewpoint, Tesla stock's downtrend is still intact with t he price target of $288.39 after a descending triangle chart pattern breakdown on February 5 . Keep an eye on the trendline support ~ $314. A breakdown could mean that Tesla stock's post election surge has completely evaporated. This note contained herein is our opinion and should not be construed as a recommendation to buy or sell. Click here to view the latest update !
Read more