It appears that coronavirus is now the headline again, as South Africa has announced it has a new variant. There have been a lot of fears of a potential lockdown coming, and that of course has people concerned in general. That being said I believe that this is a market that will eventually find reasons to rally, if for no other reason than the so-called “Santa Claus rally” that typically happens this time year as money managers try to bring home returns for clients.
The 50 day EMA sits just below, but it is worth noting that we close that the very bottom of the session. With this tells me is that we could very well see another plunge or panic on Monday, only to see longer-term traders come in and pick up value. I do not short this market as you know, but if we were to break the trendline underneath there might be a buyer of puts.
S&P 500 Video 29.11.21
Quite frankly, I more likely to sit on the sidelines and wait for support of candle in order to pick up value in a market that despite the fact that the Federal Reserve is tapering its bond buying program, still runs on a lot of liquidity measures being thrown at it. Because of this, I think that the market is more likely than not to be difficult on Monday, but if you let cooler heads prevail, you probably get an opportunity to make a fairly large trade. I still think that we go looking towards the 4800 level, but the panic and low liquidity of course makes things look a lot worse than they truly are.
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This article was originally posted on FX Empire
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