Fed Hint Spikes Market

By seadmin

The market meandered within a tight trading range this morning, but after the Fed offered hints that the economy seems likely "to continue to expand at a moderate pace," stocks went right through the roof.
Let’s take a look at the chart below to get a sense of where things are right now.

As you can see, we broke above the short-term, 50-day moving average on the S&P 500 (blue line) right after the Fed announced it was leaving interest rates at 5.25%.

This breaking of the short-term moving average could be the harbinger of more upside for stocks. Could this change be the end of the correction that started at the end of February? Possibly, but my gut feeling is that we are in for a bit more selling.

Before you get too excited about today’s market spike, keep in mind that very often these post-Fed meeting surges don’t hold. Many times you get a trading bounce on good news, especially when the market’s been beaten up.

The next few trading days should tell us if this spike is for real, or if the bias is still in favor of the sellers.

Stay tuned.

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