Keep in mind that this market had recently formed a bit of a “V bottom” but may be getting a bit ahead of itself. By doing so, it looked as if we were going to try to wipe out the massive move lower. However, we have clearly not done so, and now it looks as if we are hesitating at a potentially important technical barrier.It is also worth noting that the area had been resistance previously, so it is likely that we will see quite a bit of noise in this area as we have been chopping around.
Keep in mind that there are a lot of global concerns right now when it comes to trade and energy supply. As long as that is going to be an issue, it is very likely that we will continue to see noisy behavior that shows confusion. Ultimately, I think we are more likely than not to pull back, just because there is not much in the way of the bullish sentiment longer term. Furthermore,
the market is likely to see a lot of headline risks out there, and I just don’t see this being changed any time soon. The markets will continue to see a lot of concerns, especially with the war in Ukraine sitting right at the doorstep of Europe. The markets will continue to be somewhat skittish, but the 50-day EMA seems to be trying to hold back the buying pressure. The market breaking above the 50-day EMA is a bullish sign, and that could be a sign that we are going to the 200-day EMA. The market would more than likely follow a lot of other markets around the world, so pay attention to them also.