Following the collapse of Silicon Valley Bank, traders rushed to reassess their Federal Reserve rate hike expectations and made bets that the central bank would recalibrate its plans for interest rate increases to prevent financial instability. And U.S. Treasury yields continue to collapse on Monday morning as Wall Street investors evaluate the breakdown of Silicon Valley Bank while also keeping an eye on inflation data that is set to be delivered on Tuesday in the form of the latest Consumer Price Index report.
So far the SPX is already extended from 8&21 EMAs, and even U.S. authorities secured depositors' funds and created a lending facility for banks to meet depositors' needs, however, the investors' fear for mid-small banks still going on. And caused this extension unlikely to fill by price in the next couple of days. Therefore, it likely breakdown yesterday's low again, or even retests the 3770ish level again.
This part of moving can be considered and may likely go like this in the next couple of days for markets. As we mentioned last Friday, the best way for investors to approach this is to focus on companies that would be most resilient to persistently high-interest rates. As a hedge against inflation and these extreme market fears, precious metals might also work. And recent GOLD was going nice, but a little close to the BOLL band higher level, so some tech correction might happen recently in short term.
For today, I will keep an eye on long positions, like long the SPX if I see it hold above 3770ish level. AMD is still a good choice for day trading, simply use yesterday's low as your stop loss.
Feel free to leave me your thoughts and if you have any questions please let me know, have a good trading day.
