Wednesday, August 24, 2022

Accumulate Now or Repent Later

Accumulate Now or Repent Later
 
 

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The United States equities markets turned down sharply on August 19 after the minutes from the Federal Reserve’s July meeting showed that participants believed “that there was little evidence to date that inflation pressures were subsiding.” Additionally, Federal Reserve Bank of St. Louis President James Bullard said on August 18 that he favored another large rate hike in the September meeting as he did not believe that inflation had peaked.

The bulls repeatedly pushed the price above the overhead resistance of $24,666 between August 13 to 15 but could not sustain the higher levels. The buyers again tried to clear the overhead hurdle on August 17 but the bears held their ground. This may have tempted short-term traders to book profits. 

That pulled the price below the 20-day exponential moving average (EMA), which was the first sign that bulls may be losing their grip.

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