Equity markets are rising after the recovery of demand for risky assets. S&P 500 closed last week at the highs since October, finally convincing everyone of overcoming an important resistance at 2800 points. Shanghai blue-chip index China A50 rose 2.7% on Monday, closing at the highs area since April last year.

As for technical analysis, we are witnessing an almost perfect picture for future stock markets growth. The markets decline during October-December was a "Trump Rally" correction. This correction brought back the attractiveness of those stocks that were drivers of growth in previous years, but then looked a bit overvalued.

The subsequent pullback since the end of last year was sharp, showing overbought levels on the daily charts. In early March, this overbought background turned into a decline, which, in turn, was also bought out. The first bell that the markets did not seriously consider the March decline, was that the markets quickly turned to growth after touching the 200-day moving average.

The second confirmation was the consolidation above 2800 – an important resistance level, from where the S&P 500 turned to decline four times since October.

It is also worth noting that the growth of US stock indices is still far from exhaustion, as the RSI remains in neutral territory.

The S&P 500 has overcome previous important levels of consolidations, and now it can be on the direct path to updating its highs at 2940, which is 4% higher than current levels.

The Fed, the ECB and the PBC rhetoric softening can be noted as the main market drivers. As in 2016, they managed to stop panic sales in the markets by mitigating rhetoric. Later this week, the next Fed meeting will take place, and markets are waiting for the soft rhetoric confirmation of the most important world central bankers, which additionally can breathe life into the demand in the stock markets.

Trade Responsibly. CFDs and Spread Betting are complex instruments and come with a high risk of losing money rapidly due to leverage. 77.37% of retail investor accounts lose money when trading CFDs and Spread Betting with this provider. The Analysts' opinions are for informational purposes only and should not be considered as a recommendation or trading advice.

Recommended Content


Recommended Content

Editors’ Picks

GBP/USD clings to recovery gains above 1.3200, as BoE looms

GBP/USD clings to recovery gains above 1.3200, as BoE looms

GBP/USD sustains the recovery above 1.3200 in early Europe on Thursday, having found buyers near 1.3150. A fresh US Dollar pullback and a rebound in risk sentiment offer support to the pair ahead of the BoE policy announcements. 

GBP/USD News
EUR/USD holds higher ground above 1.1100, focus shifts to ECB-speak

EUR/USD holds higher ground above 1.1100, focus shifts to ECB-speak

EUR/USD is holding higher ground above 1.1100 in the early European session on Thursday. The pair is underpinned by the renewed US Dollar retreat, as traders digest the Fed's dovish outlook, bracing for ECB-speak for fresh trading incentives. US data are also eyed. 

EUR/USD News
Gold price jumps back closer to all-time peak, $2,600 remains in sight amid fresh USD weakness

Gold price jumps back closer to all-time peak, $2,600 remains in sight amid fresh USD weakness

Gold price regains positive traction following the previous day's pullback from the all-time peak and builds on its steady intraday ascent heading into the European session on Thursday. 

Gold News
BoE expected to keep interest rate unchanged at 5% as price pressures persist

BoE expected to keep interest rate unchanged at 5% as price pressures persist

After a close call in August, the Bank of England’s September interest rate decision is keenly awaited for fresh cues on the bank’s future policy action and the pace of its bond sales.

Read more
Bitcoin surges to $62,000 mark after 50 bps Fed rate cut

Bitcoin surges to $62,000 mark after 50 bps Fed rate cut

Bitcoin and Ripple eye for a rally as they break and find support around their resistance barrier. Meanwhile, Ethereum demonstrates signs of recovery as it approaches a critical resistance level, indicating that an upward rally could be on the horizon if it successfully breaks through.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Majors

Cryptocurrencies

Signatures