Hiyo stock friends! It’s good to be back in the market again! Anyway, on today’s post is the daily canvas of the S&P 500. Like the Dow Jones in my friend’s post during the past weekend (kindly see it here), the broader index of the US, which for me, is more representative of the US’s economy, has also risen back to life after making a false break down. As you can see, the index had already broken below the neckline of a head and shoulders pattern. Luckily, investor confidence resumed and the index was able to keep itself back above the neckline again. Should the break down continued, the US’s equities could have been on a bear market again, probably leading to a double dip recession in the country’s economy.
Technically speaking, the S&P 500, however, is not yet out of the woods. It wood be on a better ground if it is able to move above both the 50-day and the 200-day average. A couple of indicators, though, show some bullish signs. One is the RSI which recently went above 50. In case you do not know, an RSI reading of above 50 indicates that the upward momentum is gaining speed. Notice also that the MACD had just made a bullish crossover as well with its histogram turning positive. In any case, if it is able to move past 1,150, then its next target would be its previous high just above 1,200.
Fundamentally, the market would be looking for some catalyst from the second quarter earnings report of the big firms in the US. Tech-giant Google and and financial holding company, JPMorgan Chase & Co., are set to release their earnings tomorrow (July 15). Bank of America and Citigroup will also publish theirs on July 16. Several market moving data from the US (PPI, Philadelphia Fed manufacturing index, CPI, and University of Michigan sentiment survey) will likewise be reported. Upside surprises from any of these reports could spur some buying while the opposite could cause some selling. Watch out for these reports!