Fed’s Support Pushes Stocks Near New HighsPosted 06/21/2019 8:57AM CT |
Stocks got a positive boost on Wednesday with the Fed’s dovish statements and outlook of continued stimulus along with positive outlook on U.S./China trade progress. The possibility for a rate cut as soon as July, coupled with additional cuts by the end of the year, pushed the market back towards all-time highs. On the other hand, the market looks to have priced in support from the Fed and escalating tensions between the U.S. and Iran with a U.S. drone being shot down this week.
Today, we end the week with speeches from the Fed. If the majority of those speeches show intentions of continued support of the economy, the trend higher should continue. The S&P started the session pulling back on news that the U.S. launched an air strike before calling it off last minute. Momentum studies show the market is at overbought levels, but the short-term trend remains to the upside until fundamental news shows otherwise. In the September contract support comes in at 2930 and if that is broken the next downside target is 2894. A push over the May highs of 2976.75 would accelerate the rally higher.
E-Mini S&P 500 Sep ’19 Daily Chart