Well, that was not a fun day, and it raises the question of how? How does one invest if this is the new environment in which we live? It is not sustainable. From what many had thought was market-friendly President has suddenly become very unfriendly. Perhaps there is a feeling that because the S&P 500 is up nearly 30% since taking office, the President is willing to gamble and take a hit on the stock market of to 5-6% if means getting his agenda through. But if this behavior continues, it will do a great deal of damage to the mentality of the stock market, which may take a long time to recover. People still live in fear of what occurred in 2008.
S&P 500 (SPY)
At this point, the S&P 500 appears to be falling along a downtrend, near perfectly. However, if anything positive came out today’s trading, it is the technical pattern that formed, a falling wedge. That is a bullish reversal pattern. It is similar to what we have seen in Apple and the semiconductors in recent days.
Apple did manage to hold technical support today around $175, and we can see that the stock has broken free from its falling wedge, and it would suggest the stock rebound.
We can see a similar pattern has formed in the Semiconductor SMH ETF.
We can wait and be hopeful. But again, I don’t know what kind of tweets will fly around over the weekend.
Square is one stock that does not look healthy. A drop below $61 puts it on a path to $56
Boeing is also on the cusp of a big break down here, and that could send the stock back to the $325.
That is all for today.
This article first appeared on Mott Capital.
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