Dip buyers set to be rewarded for their efforts yesterday?

Things started off rather poorly for stocks yesterday but dip buyers managed to salvage something by the end of it all. Tech shares were still the laggard but it certainly wasn’t as bad as could be from the onset. The S&P 500 somehow pulled off a stunning recovery to even close above its 100-day moving average (red line). The key level is seen at 5,822.51 currently.

Throughout the entirety of 2024, the S&P 500 only firmly broke below the key level once. That came during the August market panic and it was a brief one, lasting for only four sessions.

It’s a major technical level in terms of indicating a more bullish bias for the index. As such, it stands to reason why buyers will be wanting to hang on to that for as much as they can to keep the run going.

At some point, there will be a correction and we might arguably be overdue one. But for now, dip buyers are not throwing in the towel just yet. And they might just get rewarded for that after the Bloomberg report saying Trump’s economic team is exploring options for a less bombastic tariffs approach to begin with.

S&P 500 futures are up 0.3% on the day, helping to feed a more positive mood ahead of European trading later.

Besides headline risks, we will also have economic data to look forward to in dictating market sentiment this week. US data is back in focus with the CPI report tomorrow. For today, there will be the PPI report to kick things off. And on Thursday, there is the weekly jobless claims and retail sales data to work through.

Other than that, earnings releases are also back in focus and we’ll be kicking things off with the big banks later in the week. Greg highlighted the list in his post here.

This article was written by Justin Low at www.forexlive.com.