- The S&P 500 pulls back a bit after the Nvidia induced rally. What’s next?
Last Friday, the S&P 500 pulled back a bit after the incredibly strong Nvidia induced rally as we probably saw some profit taking. On the economic data side, we got another slate of strong data last Thursday with the US Jobless Claims and US PMIs beating expectations. The Fed members continue to repeat that they want to see a couple more of inflation reports before deciding on rate cuts, but they keep on reiterating that cuts are coming this year. Overall, the path of least resistance remains to the upside.
S&P 500 Technical Analysis – Daily Timeframe
On the daily chart, we can see that the S&P 500 eventually bounced on the red 21 moving average and rallied all the way up to make a new all-time high. There’s been lots of FOMO following the Nvidia earnings report but chasing the price at these levels doesn’t look like a good idea from a risk management perspective. In fact, the buyers would have a much better risk to reward setup around the trendline.