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The S&P 500 has rallied a bit during the trading session now that we are beyond the CPI numbers in the United States. The number came out as hotter than anticipated, reading 5% year-over-year. However, the market still looks very bullish, and eventually we could see this market looking towards the 4400 level. In the short term, the occasional pullback could be a buying opportunity, with the 4200 level offering a significant amount of support as it was previous resistance.
S&P 500 Video 11.06.21
Underneath there, then the 50 day EMA comes into the picture near the 4132, which should also offer a significant amount of support based upon the fact that it has been psychological support multiple times. Regardless, we are in an uptrend so there is no reason to think that you should be a seller of this market, and even if we do break down from here it is very likely that the 4000 level underneath will be a massive “floor the market” as it is not only a large, round, psychologically significant figure but it is also an area where we see a bit of a gap that has a certain amount of support attached to it.
All things being equal, this is a market that would be a “buy on the dips” type of situation, as we could go looking towards the 4400 level eventually, but it is going to take a significant amount of time to get there. With that being the case, I think that what we have to look at here is whether or not there is some type of value that we can take advantage of as it dips.
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This article was originally posted on FX Empire