Market Event which could bring trading opportunities
Sentiment is getting positive again after the SPX went for -23 to -11% in the last few weeks. Today inflation numbers created a GAP on the SPX. Will it be able to consolidate 4200? Time will tell. Managers that did not purchase last bottom are lagging the Indexes performance and shorts that wanted to see
From Refinitiv: The action raised the short-term federal funds rate to a range of 1.50% to 1.75%, and Fed officials at the median projected the rate increasing to 3.4% by the end of this year and to 3.8% in 2023 – a substantial shift from projections in March that saw the rate rising to 1.9%
There will be a time for the bulls again. The largest institutional investors are modifying their macro view and target pricing around the US Equities, this will create events similar to what we experienced today. Nobody that I know can predict with certainty future prices actions however the best way to know if a decision
Yellen mentioned: “I think I was wrong then about the path that inflation would take.” “https://www.reuters.com/markets/us/yellen-says-she-was-wrong-about-inflation-path-biden-supports-fed-actions-2022-05-31/ From the article: “As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn’t at the time fully
This week could be the first of the last 8 weeks that the SPX is going to close above the previous week high. The downside price trajectory have been relevant to historical standards in the last 5 months. Marker participants have been repricing key sectors that are likely not well position for a inflationary environment.