With the recent rally of 10%+ over the last few days, it seems clear that the resistance level of $2750 has rejected price action and pushed the price 100 points down just in one day. Was the sudden spike on monday and tuesday morning a result of false optimism with respect to Coronavirus cases and deaths in the USA or just investor sentiment amidst the rumors of another stimulus package by the Fed? (Source) We don't really know but what is clear is that price has had a strong rejection off the $2750.
With today's news about the highest rise in coronavirus related deaths in New York and the increase in cases as well as deaths across the world and especially in countries like Spain, it seems that the market has reacted strongly to the negative reports that have been released with respect to this global pandemic. (source) This is not taking into account the data that is yet to be released with respect to corporate quarterly earnings, confirmed unemployment numbers and other income/labor related statistics that significantly impact investor sentiment.
There has been ~30% decline among most financial assets and popular investments across global financial markets since the Covid 19 pandemic took off. (Source) Whether it's REITs, indexes or even commodities, the impact of Coronavirus has been felt globally and we believe it's about to get even worse.
As unemployment numbers rise, small business continue to close and coronavirus related cases and deaths continue to increase, it's hard to imagine that we've hit bottom. We think things are going to get worse before they get better and as we continue hoping for a plateau in Covid-19 spread, S&P500 touching the sub $1900 is definitely in play especially since it held as a key support level in years prior.
With today's news about the highest rise in coronavirus related deaths in New York and the increase in cases as well as deaths across the world and especially in countries like Spain, it seems that the market has reacted strongly to the negative reports that have been released with respect to this global pandemic. (source) This is not taking into account the data that is yet to be released with respect to corporate quarterly earnings, confirmed unemployment numbers and other income/labor related statistics that significantly impact investor sentiment.
There has been ~30% decline among most financial assets and popular investments across global financial markets since the Covid 19 pandemic took off. (Source) Whether it's REITs, indexes or even commodities, the impact of Coronavirus has been felt globally and we believe it's about to get even worse.
As unemployment numbers rise, small business continue to close and coronavirus related cases and deaths continue to increase, it's hard to imagine that we've hit bottom. We think things are going to get worse before they get better and as we continue hoping for a plateau in Covid-19 spread, S&P500 touching the sub $1900 is definitely in play especially since it held as a key support level in years prior.