The S&P 500 has broken down rather significantly during the trading session on Wednesday, only to slice through a significant uptrend line. Having said that, there are still plenty of support areas underneath that come into play and as these indices are so highly manipulated, it gets to be very difficult to short this market. From a pure technical analysis standpoint, it is not until we break down below the 3200 level that you get a confirmed “double top.” The 200 day EMA sits just below there and breaking through that obviously would be a very negative turn of events as well. Nonetheless, stock markets have this pesky habit in the United States of always find a reason to rally.
S&P 500 Video 29.10.20
As mentioned previously, the markets are manipulated in the sense that they are not equally weighted, so therefore it is going to come down to a handful of stocks. Once the technology companies get out of the congressional meeting for the session, it is possible that people will jump into the major companies again, and therefore push the S&P 500 higher later in the day. Ultimately, this is a market that is always a “buy on the dips” type of situation but it takes quite a bit of sense to look for a daily supportive candlestick in order to do so. This is because the markets are most certainly nervous at the moment, so I do think that we will have an opportunity to pick up value and write it out. However, between now and the election things are going to be very dicey to say the least of keep your position size small.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire