S&P500 - Analysis

S&P 500 Index - Analysis

Almost every indicator, be it
1. RSI
2. STOCHASTIC RSI
3. William's % R and others
are extremely oversold on daily, weekly & monthly time frames.
This calls for a short term relief rally in the index, up till 50 ema or 3925 levels & then another leg of downside till 3250 levels.
There are high chances of market stabilizations near those levels, however Fed Pivot will be most crucial to predict a probable bottom in the US markets.

What strategy should investors adopt?

1. Investors can use this relief rally to "sell on rise" and churn their portfolios.
2. Investors should completely dissolve companies with poor fundamentals and stick to just quality stocks.
3. Investors should keep at least 40% cash in hand to buy the dips when FED pivots.

What strategy should traders adopt?

Traders can just stick to short term swing trades, however expect massive volatility. Must keep defined SL in system,