On Friday, the E-Mini S&P closed right at the level where it opened Monday morning, with price consolidating at the 2250 level. Despite the FED interest rate hike and the potential for additional rate hikes in 2017, US stocks did not budge, which can be interpreted as a bullish signal. On Friday, the markets experienced more volatility as news came out that China seized a US vessel, sending oil higher while bonds yields and the dollar traded lower.
More and more analysts are talking about warning signals that a turnaround could be imminent but we cannot ignore the facts and that despite the rate hike, all major benchmarks held their position. The daily chart shows a small wedge formation – a consolidation pattern. We still haven’t seen any real retracements or profit taking over the past 6 weeks. However, traders should focus on momentum as long as price keeps trading at