A bull market is born on pessimism
The S&P 500 is back into a bull market, after closing strongly above 4200 points last Friday. This bull market started October 13, 2022 and now it has closed more than 20% off the lows of the last bear market. In fact the S&P 500 together with the Nasdaq Composite has been so strong this year, that many investors have missed out on this rally, that has been going on for 8 months.
How is it possible if all the media has been painting recession in 2023, and interest rates keep rising, but a bull market can be born? One key point is the market tends to move 6 to 9 months ahead of the economy, as it is always factoring future earnings potential.
Long term trend is bullish, 50 daily moving average (MA) above 100 MA, which is above 150 MA which is above 200 MA. However 200 MA is starting to level off, this is getting interesting. Expecting some sellers to test 4300, and looking for a pull back with support at 4200.
S&P 500 after last Friday's bullish session
Stock market vs economic cycle
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
It is also possible that the recent rally in the stock market is simply a temporary phenomenon.
The long term trend is looking bullish with the moving averages, but I'm curious to see how the market reacts to sellers testing 4300 and if support holds at 4200. 🤔📈
Wow, the S&P 500 is back in a bull market! But how can that be with all the talk of a recession and rising interest rates?
It is possible that a bull market is born on pessimism recently. The stock market has been on a tear in recent months.