S@P 500The S&P 500 rallied 4.8% last week. Great reports from tech companies and liquidity injections by central banks to stave off a global economic downturn have pushed stocks up significantly.
In the short term, the SP500 will reach a psychological resistance of 4,000 points and I believe at this level, profit taking and exit from risky assets will begin. I also believe that we will have high volatility at 4000.
Continuous injections of liquidity from central banks to stave off a global economic downturn have become one of the main drivers of market growth and the growing discrepancy between the current value of shares and their fundamental value. At the moment and with today's factors, I would prefer to wait for a clear confirmation of the shorts from the border at 4.000.
You can see for yourself how overheated the market is. On the left side of the chart, you see Live Nation Entertainment (LYN) stock rallies from its March low to date of 250%. Despite the fact that there have been no concerts in the last 10 months.
Over the next week, investors will be looking to focus on strong P&L, financial stimulus expectations. Important earnings reports await that will definitely impact the index ( Twitter , General Motors and Disney).
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