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The S&P 500 rallied for the week, although it must be noted that Friday was a little bit soft after the disappointing jobs figure. Nonetheless, Wall Street will find a positive spin on this, if for no other reason than the Federal Reserve still cannot move to tighten monetary policy. Yes, they will probably continue the idea of tapering later this year, but it is such a slow pace that it should not make a huge difference. The uptrend line underneath continues offer plenty of support, and as a result I do not have any interest in shorting this market.
S&P 500 Video 06.09.21
In fact, it is not until we break down below the 4400 level that I even consider buying puts. This is a market that continues to see money stuffed into it, so it is almost impossible to short it. Yes, someday we will have a significant pullback, but we are nowhere near that right now and as a result I think what we are looking at is a continued “buy on the dips” type of market. After all, that is the way this market has been 90% of the last 13 years after the Great Financial Crisis. The Federal Reserve continues to stand on the sidelines and kick the ball back in bounds every time it gets a bit hairy, and I just do not see that changing. With this in mind, I simply look it dips as an opportunity to get involved yet again. I suspect that most other traders look at this as well. There is an entire generation of traders right now that have never seen a bear market.
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This article was originally posted on FX Empire