The S&P 500 is one of the
largest and the closest-watched indices in the world. The index is made up of
the biggest public companies in the United States. Blue chip companies like
Apple, Microsoft, and Salesforce make the index. The companies in this index
are then divided by their sectors, which include materials, technology, energy,
utilities, telecoms, pharmaceuticals, financial, retail, and real estate.
This year, the S&P 500 index
has managed to recover from the declines witnessed in December, when it reached
a low of $2327. Since then, it has reached a high of $2818. There are a number
of reasons why this has happened. First, the Federal Reserve has moved from the
previous hawkish statements and adopted a policy of patience. This year, the
Fed has pointed that it may not have any hikes while traders believe that one
rate hike could happen. Second, United States and China have been having talks
with the aim of solving the trade issues. Already, there are hopes that the two
could sign a deal within a few weeks. Third, the earnings released recently
were a bit better than expected. In addition, the US economy is on track to have
the longest recovery since 1945.
The recovery in the index has
been hampered by a number of issues such as Brexit and the fears of a global
economic slowdown. Investors are also concerned about whether US earnings have
peaked. In addition, they are afraid about the lack of a catalyst that can
propel the stocks higher. This is because the key issues such as the Fed and
trade have been resolved.
As shown in the chart below, the
index has made a V-shaped recovery since the December lows. This price is above
the Supertrend indicator and all the short and medium-term moving averages. The
index also appears to have found some resistance. In the coming days, the index
could continue to move up to retest the important resistance levels of $2900.
The post What Next For the S&P? appeared first on Forex.Info.