Is the S&P500 ready for another leg higher?
Monday’s rally allowed the S&P500 to close back above its 200-day MA after the index had been testing this level for a few days in choppy trading following the FOMC meeting.
The recent sell-off saw the $SPX find support around the July/October lows, showing strong demand at these levels, and potentially pointing to the fact that the index the market finished forming a low and is ready to rally.
However, when looking at the S&P500 futures contracts, the last couple of days of rising prices have occurred on falling volume. This is somewhat concerning as the lack of longs participating might indicate that this is simply a corrective bounce.
All trading carries risk, but as February trading gets underway, it will be interesting to see if the broader market can put January in the rearview mirror and push higher.
Submitted February 01, 2022 at 10:46AM by City_Index
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