Stocks Race Higher Ahead Of Important Inflation Data
Michael Kramer | Mar 10, 2021 01:31AM ET
Stocks had a great day yesterday, with the S&P 500 climbing by 1.4% and the Q's climbing by almost 4%. Very strange to see, especially after the selling witnessed on Monday. In fact, yesterday's move higher, I expected on Monday. But it happened none-the-less.
This really started overnight in Asia, when it seemed the Chinese communist party was not pleased with the weak price action in their markets. That put a bid in Asian stocks, and well, S&P 500 futures spiked as well, and it seems to have just carried over.
The index struggled at 3,900 all day, and it proved to be too much for the time being. A big sell imbalance on the close, more than $3 billion, pushed the index about 60 bps off its highs.
h2 S&P 500 (SPY)/h2A lot of what happens next will be dependent upon CPI data today. If the data is hotter than expected, it could easily wipe out many of Tuesday's big gains. It would not surprise me for the S&P 500 (SPY) index to give most of these gains away over the next few days and close the gap from yesterday morning’s move higher.
The trend in rates is higher for now, but a breakdown could give the S&P 500 and technology stocks some relief, sending the equity market even higher. If CPI comes in hot, the 10-year would likely overtake 1.6%. There is the possibility of an ascending triangle forming, which would suggest yields move higher. But we won’t know until Wednesday.
Nvidia (NASDAQ:NVDA) had a strong day Tuesday, coming back from oversold conditions. The stock reached a level around 30 on the RSI and fell below its lower Bollinger® Band yesterday. Based on that, there could be a little bit higher to climb, perhaps back to $520.
Get The News You Want
Amazon (NASDAQ:AMZN) had a strong day too, but couldn’t manage to make it past resistance at a price around 3,070. The stock isn’t as oversold as others, so it may not have much further room to run.
DocuSign (NASDAQ:DOCU) is another stock that could have a bit further to climb, perhaps back to $226.
Original Post
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.