The stock market rallied on Fed Chief Powell’s remarks yesterday. But will it continue the uptrend?
The S&P 500 index gained 3.09% on Wednesday, as the market rallied following Jerome Powell’s dovish speech . The broad stock market’s gauge was the highest since September 12 yesterday. The index broke above its recent trading range and it went to the new local high of 4,080.11.
This morning the S&P 500 is expected to open virtually flat, and we may see some more buying pressure, as investors’ sentiment remains bullish despite the interest rates uncertainty. The index bounced from an over month-long upward trend line yesterday, as we can see on the daily chart:
Futures Contract – Consolidation Following Rally
Let’s take a look at the hourly chart of the S&P 500 futures contract. It is trading within a relatively narrow price range this morning. The support level is now at 4,000:
Conclusion
The S&P 500 index is expected to open slightly higher this morning. It rallied over 3% yesterday, so we may see some profit-taking action later in the day. There have been no confirmed negative signals so far. Investors will be waiting for the important monthly jobs data release tomorrow.
Here’s the breakdown:
- The S&P 500 rallied after breaking above the 4,000 level again.
- Stocks broke out of their short-term consolidation and we may see some more buying pressure.
Thank you.
Paul Rejczak,
Stock Trading Strategist