- Can U.S. stocks hold the 200-day moving average?
- Can the bulls regain dominance?
- You choose to stay long or go short?
$S&P 500(.SPX)$ trading at a critically important level here. Right below the 50 Day Moving Average(MA50 Redline) but right above the 200 Day Moving Average(MA200 whiteline).
Recently, the performance of the $S&P 500(.SPX)$ has been relatively weak. It has recorded a decline for three consecutive weeks, and last week it fell by 2.7%, the worst weekly performance since 2023.
Day chart of .SPX
Day chart of .IXIC
Day chart of .DJI
Will the 200 Day hold as support?
Firstly, there are 3 Key facts affect Thursday’s market trend:
1) Musk's "Mater Plan 3" lacks details of the market's expected integrated die-casting technology and next-generation electric vehicles, $Tesla Motors(TSLA)$ 's stock price falls more than 5%,
2) $USD Index(USDindex.FOREX)$ rise 0.41% to $104.83, The trend of the dollar and the trend of the index are still negatively correlated.
3)The yield on the 10-year U.S. bond once broke through 4% to 4.006% for the first time since last November. Short-term rates surged even higher.
USD Index as of 2 March
Secondly ,In the context of an uncertain macro outlook, investors have also begun to pay more attention to technical graphics.
The $S&P 500(.SPX)$ is currently only about 1% away from its 200-day moving average. If this key support level is broken, it may trigger a new round of selling.
- JPMorgan's trading desk warned that trend-following quantitative traders may have to sell as much as $50 billion in stocks if the $S&P 500(.SPX)$ falls below a key technical support point, the 200-day moving average.
- According to the team led by Marko Kolanovic, history shows that the $S&P 500(.SPX)$ is 2.5 times overvalued at current levels of real interest rates.
- Morgan Stanley big short Michael Wilson, also warned that stocks were under pressure in March from weak earnings and elevated valuations.
Separately, traders added nearly $3 billion to their short position in $S&P 500(.SPX)$ futures last week, while pulling a net $5.1 billion from exchange-traded funds (ETFs), according to statistics.
Amid the pessimism, HSBC Bank Plc strategist Max Kettner believes that with strong economic growth and expectations of rising interest rates already priced in, a relief rebound in U.S. stocks is more likely.
Vote Please,
What your attitude toward current trend?
Can U.S. stocks hold the 200-day moving average?
Can the bulls regain dominance?
Will you choose to stay long or go short?
$Nasdaq100 Bear 3X ETF(SQQQ)$ $Dow30 Bear 3X ETF(SDOW)$ $S&P 500 Bear 3X ETF(SPXU)$ $S&P 500 Bear 2X ETF(SDS)$
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