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S&P 500: 2022 Could Spoil The Party For Bulls

By Satendra SinghStock MarketsJan 02, 2022 10:23AM ET
www.investing.com/analysis/sp-500--2022-could-spoil-the-party-for-bulls-200613352
S&P 500: 2022 Could Spoil The Party For Bulls
By Satendra Singh   |  Jan 02, 2022 10:23AM ET
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The bulls are struggling to breathe at heights they achieved in 2021 amid the supportive tune of the central banks to sustain the misbalancing global growth due to economic disruption caused by the pandemic.

Undoubtedly, the confirmation of the first case of coronavirus in January 2020 resulted in a sudden jolt for the S&P 500 futures. This sudden jolt resulted in a steep downward move from 3392 to 2192 within a short span of the subsequent 24 trading sessions in March 2020.

Chinese slowdown could be the first to dethrone global equity bulls from the heights they attained due to the resurgence of Omicron almost at peak level during the last week of December 2021. Undoubtedly, Omicron has already pushed the reverse gear of the global economic growth with a sudden surge in COVID cases in most parts of the world.

China ended its final week of 2021 with its biggest tally of local coronavirus cases for any seven days since subduing the country's first epidemic nearly two years ago, despite an arsenal of some of the world's strictest measures to combat COVID.

A steep surge in the US equity markets has given the Fed the green light to end the taper, which will likely lead everyone to believe that the Fed will raise rates in March despite easing inflation rates and slowing economic growth. All these sequential events ensure a steep slide in global equity markets like we had seen in 2018.

Technically, a gap-down opening of the S&P 500 futures on the first trading session of 2022 will be a step towards the diminishing bullish sentiments amid the currently prevailing economic scenario. If the S&P 500 futures see a breakdown below 4493 during the first week of January 2021, it will confirm the repetition of a steep slide likewise in March 2020.

S&P 500 futures weekly chart.
S&P 500 futures weekly chart.

S&P 500 futures daily chart.
S&P 500 futures daily chart.

Disclaimer:

  1. This content is for information and educational purposes only and should not be considered investment advice or recommendation. Past performance is not an indication of future results. All trading carries risk. Only risk capital be involved which you are prepared to lose.
  2. Remember, YOU push the buy button and the sell button. Investors are always reminded that before making any investment, you should do your own proper due diligence on any name directly or indirectly mentioned in this article. Investors should also consider seeking advice from an investment and/or tax professional before making any investment decisions. Any material in this article should be considered general information, and not relied on as a formal investment recommendation.
S&P 500: 2022 Could Spoil The Party For Bulls
 

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S&P 500: 2022 Could Spoil The Party For Bulls

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Comments (3)
jason xx
jason xx Jan 07, 2022 12:35PM ET
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Good read
Doug Favell
Doug Favell Jan 05, 2022 12:02PM ET
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January 2021? Seriously?
Flee Mani
Flee Mani Jan 03, 2022 4:41AM ET
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Covid is old news. The bulls are here
 
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Disclaimer: This analysis is purely based on the technical observations. I do not have any position in Natural Gas. One can create position in Natural Gas at his/her own risk.
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