The XJO is expected to open higher this morning following a strong rally in the U.S last night. Their futures are also marginally in the green.
Yesterday was a tumultuous day of trading. We opened near 8,350 resistance, but cracked through aggressively in the morning session, reaching the next key level of 8,450 by about 11am. However, by 12pm we had shed all those gains, falling about 100 points, led by deep negative U.S futures. We managed to crawl back about 50 points into the close, to finish flirting with 8,400 key resistance.
Our move yesterday preemptively broke us through the previous peak at 8,350, with the highs of the day putting us within arms reach of our all-time high. For a moment there, it seemed the U.S was going to have a bad night, but instead they followed suit. They too broke through their previous peak, and finished within arms reach of their all-time high. Our market should have the confidence to retake most of the intraday losses, with an expected open near 8,450 key resistance, now that it has confirmation of a strong U.S.
From here is hard to say. It seems the bulls beat the bears in the battle around Trump’s inauguration. It was a fierce campaign, but it seems the bulls have it, and markets look set to move higher. However, though the bulls won the battle, perhaps the war is yet to be decided. Trump spells volatility.
US Markets
US shares jumped strongly overnight with Trump’s first day in office. It is clear that he will flow more government money to private companies and indeed overnight he announced $500 billion in funding for private AI infrastructure.
Technically, US markets look like continuing higher and don’t be surprised if we see 6,100 for the SP500 at some point this week. Whether or not Trump can lead to an additional sustained rally (and whether 2025 is a repeat of 2024) is another question.
Ten of the eleven sector groups of the SP500 closed higher overnight, with only Energy stocks closing lower. Industrials, Real Estate, Healthcare, and Utilities were the best performers.
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