SPX Looking to retest the 200.

26 janv. 2022

Hello Traders -

After the last few trading sessions you're probably almost convinced that the sky is going to fall out, that geopolitics are an issue right this moment, and that we're headed for a crash. I'd like to let you in on a little secret... When everyone thinks there will be a crash, there isn't one.

Now don't get me wrong, we did just have a solid pullback from ATH's, and while it wasn't a small pullback, we did complete an IHS pattern and hit it's target pretty accurately. Then after gapping down to recession territory, shortly before FOMC's meeting probably had some Bulls a little worried.

Personally, I don't think Geopolitics is yet factored into any market movement. The pullback was more related to COVID resurgence causes uncertainty, and if there is one thing the market doesn't like.. It's that. Not only this, midterm election interest has been pulled forward and midterm years are almost always more volatile. Lastly, inflation worries. These are the big 3 currently affecting the market, could the Ukraine situation become an issue for the markets? Well possibly, but I can't imagine it having an affect anywhere close to the China Trade War, because that actually directly affected the markets (i.e. tariff and embargos between two extremely active traders). With more reliance on Clean energy the geopolitical posturing on the border of Ukraine will mean even less for the US and its allies.

With all of that out of the way, back to a quick technical analysis. Looks like we will see another retest of the 200MA very soon. This should give us an idea of where we go from here.

Cheers,
Mike