The S&P 500 has sold off a bit during the course of the trading session on Tuesday, reaching down towards a previous uptrend line. The market has had to deal with rising interest rates at the same time, so that of course makes stocks a little less enticing than previously. That being said, it is only a matter of time before the Federal Reserve will do something to keep this market alive. After all, it is their job essentially?
S&P 500 Video 29.09.21
If we do break down below the lows of last week, then at that point in time I will be a buyer of puts, perhaps aiming towards the 4200 level. That is an area that is attracting the 200 day EMA as well, so I do think that it makes a natural point for the market to break down towards, perhaps before recovering. After all, it would be just a touch over 10% as far as a correction is concerned from the highs, so it is completely normal to see something like that happen.
The size of the candlestick is something worth paying attention to, but at the end of the day we are still very much in an uptrend regardless of what happens next. This is why am only a buyer of puts in one short the market. As far as buying is concerned, if we can take out the candlestick from the Monday session, that would be an extraordinarily bullish sign. I do not think that happens easily those, so it is more of a grind to the upside that I would anticipate. Yes, I recognize there are a lot of concerns around the world, but each new month brings a new “crisis” to deal with.
For a look at all of today’s economic events, check out our economic calendar.