01.18.19 • +1.32%
Near term factors:
China Trade Deal
Long term factors:
Federal Reserve economic outlook
The bears returned to hibernating and the bulls stepped in to dominate the markets. The equity markets made a perfect “V” shaped bottom with continuous gains since Christmas Eve. Some traders thought the top would be around 2600 in the S&P and return to test the lows. We have broken through that resistance level and now investors who missed buying the sell off feel as if they are missing out. Good fundamentals and post capitulation lulls have buyers reassured that the market will continue higher.
The most recent catalyst to the market was a hint at the US lifting tariffs on China. This has not been confirmed but it could lead to a deal between the US and China. Now, the question is whether a trade deal is priced in. Investors and traders believe if a deal is met next week the market could surge even higher.
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