S&P 500 breaks 200 day moving average

3 April, 2018

Easter Monday is normally characterised by light trading, but today was anything but out the ordinary, as the US equity markets swung lower sharply on the back of the announcements of tariffs from China on the US. This is quite serious as the 200 day moving average has been broken, and this held back bearish movements previously. With the last line of defence now gone, it could be a case of the bears looking to push their control. This in theory has not been helped by President Trumps attacks on Amazon which have sent tech stocks down as he looks for a target. If the market sentiment is anything to go by then I would be deeply concerned for the bulls, as many have long thought of the share market being overbought, and this could be the start of some serious bearish pressure.

With the 200 day moving average being broken I would expect to see some bullish pressure to see what the market is made of. In this instance I believe any push-back up higher would likely treat the 200 day moving average as dynamic resistance in this instance. The target now for any bears looking for lower lows will be of course the 2532 resistance level, closely followed up by the 2508 level. This area will be the key to see if the S&P 500 has the legs to go even lower, and the bulls and bears will battle it out around here. In the event the bulls cane reassert control, then as mentioned before the 200 day moving average will be a hard task to beat with such a huge extension lower. All in all market sentiment is bearish now, and it will be hard to beat. But it's also worth noting that this is no 2008 scenario, the American economy is still doing strong and it's mainly politics which is driving the lower lows. In reality we could just end up with the market correction we've anticipated for some time.

Crude oil has been one of the big movers today as well, but this should come as no surprise after the recent economic woes on equity markets have spooked bulls, and as the USD lifted strongly against most of the major pairs. Many market commentators have been quick to point that over $70.00 a barrel seems unlikely as demand stays static and they expect a range of 50-70 dollars in the short to medium term. Then again time and time again we've seen commentators be wrong and oil can swing quite wildly.

On the charts the fall lower has so far been stopped by the 20 day moving average. This shows reluctance from the bears to test the technical's, so this looks more like a test the waters sort of move today. However, the ceiling at 66.05 has held for some time and is not looking like it may face much pressure. As a result this could just be trending sideways for the short term and levels will be key for traders looking to take profits. In particular support levels at 62.64, 61.00 and 58.88. With the long term daily bullish trend line to also take into consideration.


Source link  
Investors cautiously optimistic

Asian equities were trading mixed on Monday after a nervous last week which saw wild swings in global equities and emerging market currencies...

Greenback falls on trade talks

The Dollar Index retreated from its 2018 peak of 96.98 following news that China will resume trade talks with the U.S. later this month. The news allowed...

Turkish crisis spreads into markets

The Turkish Lira resumed its drop early Monday touching a new record low of 7.21 per dollar before recovering slightly during Asia trade. Comments from...


Stocks surge amidst USD weakness

The major winner today was the US stock market as it continued to surge higher on corporate earnings and an upbeat jobs report as JOTLS openings came in strong...

Is Trump truly winning the trade war?

Escalating trade tensions between the U.S. and China remain the financial markets hottest topic. President Trump seems to be celebrating...

BoJ unwilling to shift gears yet

After weeks of speculation that the Bank of Japan may begin to adjust its stimulus program, the central bank once again decided not to join the global trend...


Oil and equities jump on global events

Oil is back on the move again after the recent attack against a ship off the coast of Yemen carrying oil. The Saudis have suspended shipping around that area until the...

USD and Oil in focus

The USD lifted again against all majors, as US retail sales m/m came in strong at 0.5%, in line with expectations. At the same time the previous month was...

Investors in cautious mode

Global equity and foreign exchange markets were relatively quiet on Wednesday as the U.S. financial markets were closed in observance of Independence Day...


In the past 24 hours Bitcoin has lost -2.63% and reached $6337.89066554. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has gained 0.2108% and is now at $1.1431. Start trading and making money on Forex today.

In the past 7 days Ethereum has gained 2.48% and is now at $278.396137316. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Forex Market Analysis



Forex Currencies Forecasts



Top 10 Forex Brokers 2018

# Broker Review
1easyMarketseasyMarkets89%
2FXTMFXTM87%
3HYCMHYCM85%
4FxProFxPro80%
5FIBO GroupFIBO Group77%
6FXCMFXCM73%
7AvaTradeAvaTrade68%
8HotForexHotForex67%
9Alfa-ForexAlfa-Forex66%
10XMXM66%
  


Share: