Last Signal
Buy Signal (Long) 16.02.24:
Entry 5033, Stop Loss 4917
The S&P 500 moved up by +1.7% this week. There were slight losses at the beginning of the week, followed by strong gains towards the end, mainly driven by NVIDIA’s robust quarterly earnings on Wednesday. This upward movement has temporarily pushed the S&P 500 into overbought territory, implying that further gains are likely limited.
On Friday, February 16th, our indicators triggered a new trading signal, with the position currently up 1% (here).
As discussed in recent weeks, the 5000 point level is a crucial psychological milestone. Now that this target has been reached, the question arises: what comes next? The S&P 500 is more than two standard deviations away from its 50-week average, an extreme situation that occurs less than 5% of the time. While a larger correction can be expected from such extremely overbought levels, there may still be further upside potential before that occurs. Timing such a correction correctly is very challenging.
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