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Trends & Analysis
News

Week Ahead Preview: 22nd of April

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Gold continues to shine amid geopolitical worries

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Trends & Analysis
News

Week Ahead Preview: 22nd of April

News

P&G shares rise despite Q3 sales miss

News

Gold continues to shine amid geopolitical worries

News

Crude oil dips for 3rd session after supply data

News

Is there an AI upside for AMD?

News

GBP/USD recovers following wage report

Asset Watch

Are the bulls in control of the S&P 500?

 

Tuesday, March 7, 2023

Despite higher interest rates and reaccelerating inflation, the S&P 500 has been resilient amid the challenging macroeconomic environment. And while intraday volatility has elicited wild swings, Stifel’s Chief Equity Strategist Barry Bannister believes the bears will be the ones mauled over the next several weeks. He wrote on Mar. 3:
“Some say it is a ‘bull trap’ but that misses major trades in a range-bound, decade-long channel. They can call it a bear-market rally, a bear trap, or call it a banana. We aren’t ignoring potential six-month 10%-15% rallies…
“We had forecast a 13% S&P 500 six-month-rally to 4,300 by April 2023, which is still our view.”
With the bulls in the minority, will the contrarian trade prove profitable for the optimists?
S&P 500 Stock Chart Trading View

S&P 500 seasonality turns bullish in mid-March and lasts until the end of April. As a result, the calendar is approaching a period where the bulls have the upper hand. Likewise, the S&P 500 rallied sharply from Mar. 15-29, 2022, and the fundamentals were highly uncertain back then.

More importantly, the index broke out above its declining resistance line in early January. After backtesting the move, the line became support, and the S&P 500 bounced on Mar. 2 and continued the momentum on Mar. 3. Therefore, the technicals remain constructive, and the bulls should be given the benefit of the doubt until this changes.

So, will seasonality rule the March and April months, or is this time different?


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