A1 Trading Company

Ticker tape by TradingView

February 25, 2022

Why/Why Not Indices Are A Buy Again

Frank Cabibi

US and UK indices are back on the rise again after a stark decline from the highs on inflation, interest rate and Russian-Ukraine concerns. After the news of the invasion, equities went from heavy bearish sentiment to bull mode. Is this recent move an indicator that indices are a buy again, or is this a trap for more downside?

Why Indices Are A Buy

Stocks rise on an increase in personal spending in the US, and after the news of the Russian invasion of Ukraine. It seemed that investors might have been treating this as a sell-the-rumor-buy-the-news event as if the invasion was already priced into the market.

A quick momentum shift in the market caused a crazy surge in demand for tech stocks which have been selling off heavily until recently. Big name tech stocks like Square (SQ), AMZN, GOOG, etc. are beating earnings and showing strong growth.

Why Indices Are Not A Buy

As we approach the end of this month, we have to start looking towards the Fed meeting in early March. It is very likely that we will see a 25bp hike at the least, and interest rates may continue to rise throughout the year. Inflation is also a serious concern for the stock market and USD as we hit highest CPI levels since the 1980s.

SPX500 and UK100

indices are a buy again

SPX500 found support on what seemed to be a sell-the-rumor-buy-the-news behavior by investors on the Russian invasion of Ukraine. One thing to look out for is this falling trend line where there could be potential resistance. Lower lows and highs suggests that momentum is still bearish for the time being.

UK100 looks in better shape than the SPX as the index makes higher highs and lows on the 1D. The market bounced right off the 200 DMA for the third time since September 2021 suggesting that this level is a reliable zone of support.

A1 Edgefinder

Smart Money Tracker
See where big money is flowing with the A1 Edgefinder's smart money tracker! With one click, see where the biggest money flows are entering and exiting through COT data.

10% off code: 'READER'

GET ACCESS NOW

VIP discord

Trade Alerts, Strategies, Chatrooms & more!

10% off code: 'READER'

LEARN MORE
What To Expect From Today's FOMC

Today at 2:00 pm EST, the Fed will announce their latest interest rate decision. Estimates suggest a smaller hike of 25 basis points this time around. Here are some things to consider before the FOMC decision later today: The Fed has struggled to tighten their grip on inflation without causing too much disturbance in the […]

Read More
The Art of Not Trading

With the holiday season lingering on and a new year on the cusp of arrival, traders may glance at the calendar and notice there is not much economic news to anticipate on Friday to cap off a light week. In situations like these where there can be lulls in bullish and bearish momentum due to […]

Read More
Best Currency to Buy?

As the fiscal year comes to a close, consumers will likely finish shopping for the holidays, and traders and investors will get some respite thanks to a long weekend due to bank holidays around the world. While concerns about further stock market selloffs may be lingering in the minds of some, a promising set of […]

Read More
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
Home
Edgefinder
VIP
Menu
homesmartphonelaptopmenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram