The US stock markets were of course close during the trading session on Wednesday as it was Independence Day. However, the CFD markets were open, so we did get a little bit of action.
The S&P 500 has gone slightly higher in the CFD markets, but at this point we are essentially continued to consolidate in general with the 2700 level underneath being massive support, while the 2740 level has been resistive. I think that the market should continue to go back and forth, and I believe that the market will continue to be one that you will have to be very cautious with and perhaps trade in small bits and pieces and I believe that the market should continue to be beholden to tweets and headlines coming across the newswires when it comes to the US and Chinese trade tariffs.
Overall, I think that the 2700 level is crucial on longer-term charts, so it makes sense that we continue to see buyers jump in based upon value in that area. If we can ever get some type of good news out of the stock markets as far as earnings are concerned, or at least a calming down of trade tensions, this market could break out to the upside. A move above the 2750 level should send this market towards the 2800 level next. Otherwise, if we do break down I think that the market will go looking towards the 2650 level, followed by the 2600 level after that. Overall, this is a market that continues to be very noisy and I think that the most important thing you can do is keep your position size small enough so that if you get a sudden headline moving against you, you don’t lose too much. I believe sideways action continues to be the way going forward based upon the couple of lines that I have on the chart