S&P 500 Gets Completely Wrecked
The S&P 500 has initially tried to rally a bit during the course of the trading session during the Globex hours, but then broke down significantly below the 200 day EMA. At this point, the market looks as if it is in a bit of a runaway move, and it is possible that the 4200 level gets tested next. Ultimately, this is a market that has collapsed and is trying to send the Federal Reserve signals that it cannot handle interest rate hikes. As long as that is going to be the case, this will be a game of “chicken” between the Fed and Wall Street. So far, the Fed has held its own.
S&P 500 Video 25.01.22
Keep in mind that Wednesday has an FOMC statement, as wells and interest-rate announcement. After that, there will be the FOMC press conference, and there will be a lot of people paying close attention to what Jerome Powell has to say. If he still sounds hawkish, Wall Street could come completely unraveled. Between now and then, it is likely that we will see a lot of noisy behavior, and therefore it is a market that you are going to have to be very cautious with, and you need to think about finding better shorting opportunities in this type of environment, meaning that you would need to see some type of rally. In order to start buying this market, we would need to see some type of stability or change coming out of the Federal Reserve. I do not see that happening right away, so we probably have further to go.
Your capital is at risk
For a look at all of today’s economic events, check out our economic calendar.