Need to Know: Fed heroics or no, the S&P 500 level is destined for a retest of lows. These are the levels to watch, says this strategist

by | Aug 25, 2022 | Stock Market

In the words of the great Bonnie Tyler: “He’s gotta be sure, and it’s gotta be soon, and he’s gotta be larger than life.” The hero this market is holding out for is Fed Chair Jerome Powell, and he’s talking Friday, so that’s soon. Whether he’s sure remains the question. “Speculation is running so hot ahead of his remarks that it feels like even subtle variations in intonation could make a difference to jittery markets,” notes AJ Bell investment director Russ Mould.

Our call of the day from the founder and managing partner of Fairland Strategies, Katie Stockton, has her eyes on some bearish signals for the S&P 500, Fed heroics or no. She flags short-term oversold conditions in higher growth areas of the market that could help stocks bounce in coming days, especially in a case of well-received Fed comments. “We want to use these relief rallies, which we see as bear market relief rallies as opportunities to reduce exposure to avoid that next downdraft,” she said in an interview with Real Vision on Wednesday. Stockton went through some technical indicators she’s been watching. For example, she sees signs of a long term downtrend in the S&P’s 200-day moving average, a popular short-term momentum gauge, that flipped to a sell signal recently.

Article Attribution | Read More at Article Source

Share This