We blogged that the Fed top is here in our last post. However, the selling pressure was abated last week. The sellers were nowhere to be found. The indices closed positive last week to finish a great first quarter. With the muted price action from last week, is the market set up to launch to new heights or something else?
On Wednesday March 20th,the Fed announced the most dovish monetary policy with clarity. The market participants cheered on Thursday that S&P 500 and Nasdaq both made new highs. Unfortunately, the worries of the global slowdown took control of the market on Friday, it completely reversed Thursday’s price action.
When the Fed pivoted its easy money policy on January 4th earlier this year, the extremely oversold market responded with vengeance! The market participants have since pushed the market over the limit by triggering the fear of mission out motions. The selloff occurred during the first week of March was promptly
Over the last weekend, it had real good news on trade war. The market gaped higher right into the 2815 resistance zone at open on Monday, but it was promptly sold off from open. It had a footprint of synchronized selling (machine selling) during last Monday (03/04/2019) morning session, that S&P 500 lost 40 points in the morning session.
The S&P 500 index has finished the 2nd daily cycle on 02/27/2019. Now it is marching into the 3rd day in the 3rd daily cycle, which means it is entering the beta cycle phase in the weekly cycle. The market looked straight up in the untrained eyes because of the low volatility, but the cycles are functioning as they have always been.
