Trading Insights: Cancel the bear market, bull market resumes

Chart 1 Source: Tradingview May 03 2023 6:10 UTC

The above chart points out the upside price channel breakout as spotted on the SPX500 Index weekly chart

Market Talk

Today’s US Fed rate decision and policy statement have the potential to trigger a resumption of the October 22 - January 23 bull market

Upside risk for stock market bears:

• The Fed could trigger a bullish move for stock markets today provided they change forward rate guidance and signal the end of the rate hiking cycle.
• Sharp upside price spikes for stock market prices are a low probability high impact event but can not be ruled out if the Fed makes no hike.

Increased chance for higher stock markets on a 0.25% hike and Fed points to the end of the hike signal, or an even higher price spike for stock markets if no hike is made.

Downside risk for stock market bulls:

• Provided the Fed delivers 0.25% or higher and signals further hikes in the coming months.

Upcoming Key events:

• Thursday May 04 12:15 UTC: European Central Bank (ECB) interest rate decision, EUR/USD, EUR/JPY, EUR/GBP in focus
• Friday May 05 12:30 UTC: US Nonfarm payrolls (NFP)

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Today’s economic calendar

6 pm UTC US Fed interest rate decision: +0.25% rate hike expected; prospects Fed could signal the end of the hiking cycle

• Asset focus: EUR/USD, Gold, Dow 30, SPX500, US100

Source: TradingView / J. Knobel May 03 2023 5:48 UTC

Earnings Season:

On deck today:

Source: Trading View / US100 earnings calendar May 03 2023 6:39 UTC

Today’s trading bullets

SPX500 Index: scope for resumption of the prevailing uptrend

SPX500 Index current price 4,125, prospects for advance towards 4,244 and 4,629 in the medium term (26-49 days)

• Current price is above its 26 day and 49 day moving averages (bullish). MACD is above equilibrium (bullish), rate of change above its signal line (50) (bullish), and the observation that price has moved above the recent six week downward price channel (bullish) supports the prospects for higher price provided price can remain above the 4,032 support level.