It seems the markets are pleased with the aversion of a trade war with Mexico. Last week the SPX saw a near-4-percent recovery following the red on Monday. From Tuesday on, it was all green. And, judging from the futures markets, that trend is set to continue into the start of the week.
Does this mean we’re out of the woods and ready to print new all-time highs in the major indexes? Definitely not.
The key number for the SPX this week is 2892. A close above this level would be a sign markets may re-test the highs of the year. A failure here could be equally concerning though, as some technicians will quickly point out it could represent a triple top for the index. This, typically, is viewed as a negative signal for the markets.
The end of the week is the bigger tell. An intra-week close above 2892 is by no means an assurance this market is out of the Woods. In fact, a move above this level, followed by a pull-back and close below the 50-day moving average for the week could be viewed as a re-test and failure after the last pull-back.
Here’s the story by the pictures:
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