The S&P 500 has been trending strongly increased because the pandemic low, and on that it’s tough to guess in opposition to it even when at instances it appears too excessive to purchase. That doesn’t imply we get complacent, although, as an prolonged market can activate a dime and do-so with seemingly little warning.
With that in thoughts, we should stay vigilantly bullish. As lengthy because the SPX stays above the October 2020 trend-line and doesn’t break under 4495, triggering a lower-low, then “the trend is your friend” as they are saying.
How excessive may the market rise? That is anybody’s guess.
The most well-liked strategy to buying and selling equities is to purchase on pullbacks versus chasing momentum at new highs. This is because of the propensity for equities to say no in pretty quick order after notching new highs earlier than continuing on increased.
A break under the trend-line and 4495 would warrant warning and maybe a change in gears in the direction of a bearish bias as deeper correction threat rapidly rises.
S&P 500 Daily Chart
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