- The S&P 500 has been somewhat noisy during the month of May, and I think this may continue to be the case going forward.
- To begin with, we have a lot of confusion as to what the central banks around the world are actually going to do, although most agree that there are cuts coming.
- The biggest problem is going to figure out when they are coming, and of course how much.
At the center of this question, the S&P 500 index will be focusing crucially on the Federal Reserve. If the Federal Reserve does cut rates, it could help the stock market, but at the same time you have to ask questions as to whether or not it means the economy is starting to crumble underneath? Furthermore, it’s probably worth noting that the S&P 500 has been gamified over the last several years, as recently we have seen in video take a large chunk of trading volume and therefore the actual index itself has been struggling while a handful of stocks have been raising higher.
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Buying On the Dips
More likely than not, you will be buying on the dips when it comes to the S&P 500 during the month of June, and probably more or less for the rest of the summer. Keep in mind that volume tends to drop during the summer, so that is something that you need to pay close attention to as well. I believe at this point in time, as long as the market can stay above the 5000 area, there will be a certain amount of bullish behavior attached to it.
This just looks like a part on the chart that could see a lot of noisy behavior, but shorting this market would be a huge loser at this point. Quite frankly, every time it looks like the stock market is ready to roll over and die, there’s a new narrative on Wall Street that pushes everything higher. Remember, it is the job of Wall Street to sell stocks, and they will come up over the way to do it, normally via some type of narrative. There is no point in fighting the nature of the market, and therefore as things stand right now, I’m not even looking to short the S&P 500.
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