Shares: Is Friday’s Promote-Off the Starting of a Downtrend?…

Market Outlook: Correction Might Not Be Quick-Lived

The S&P 500 will seemingly begin Monday greater, rebounding after Friday’s sharp drop. I see this as both a short-term bounce inside a broader consolidation or a brief advance in a possible downtrend.

This week’s focus will probably be on earnings, with Palantir reporting after right this moment’s shut and AMD tomorrow.

Right here’s what I believe is more than likely:

• The S&P 500 has sharply reversed to the draw back final week, declining by greater than three% from its Thursday excessive.
• My Volatility Breakout System captured beneficial properties and flipped brief on Thursday.
• Lively trades in XLF (brief) and TSLA (lengthy) stay in place.

What This Means for Your Portfolio

For particular person buyers, this setting requires cautious place administration. Whereas the market continues to advance, the mix of low volatility, seasonal weak spot indicators, and stretched valuations means that defensive positioning might turn into more and more vital within the weeks forward.

The present market situations spotlight the worth of getting a scientific strategy to investing slightly than attempting to time each market transfer. Whether or not you’re utilizing technical techniques just like the Volatility Breakout System or following seasonal patterns, having a disciplined framework turns into essential throughout unsure occasions.

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Paul Rejczak
Inventory Buying and selling Strategist