S&P 500 Market Outlook: Neutral & Deteriorating
Market Overview: Equity markets started on strength and almost resumed bullish trends until news of the President and members of his cabinet contracting COVID-19 along with soft payroll numbers ended the week flat. As news on Friday afternoon of the president’s transfer to the hospital drove markets lower, our bullishness of the market deteriorates with it. The Nasdaq-100 was on a breakout trajectory to resume bullish trends, but now is squarely back into neutral territory. The S&P 500 wasn’t as strong during the week but was far more resilient than the tech heavy Nasdaq on Friday. As uncertainly remains this weekend around the President’s health, the election, the only thing that seems certain is elevated volatility over the next couple of weeks. Important levels to watch on QQQ is the $260 support from 2 weeks ago and $323 on the SPY. Violations below these key support levels would bring the markets into a bearish trend. If the president’s health improves significantly next week and QQQ breaks above $282 and $343 on SPY, that would resume a longer term bullish trend on the equity markets.
DailyPlay Update: As the amount of uncertainty around the President’s health remains extremely high, we will take a pause from entering new positions until we can better establish the market’s reaction this week.
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