The S&P500 (SPY) was pummelled by AI warnings and the Fed hike last week, and on Wednesday afternoon looked on the verge of crashing. And yet somehow, without any change in the news, it recovered all the way back
Summary
- The S&P 500 reversed last week's sharp drop, closing nearly flat, supported by technical strength at key levels.
- A break above the 7710 channel resistance would confirm a new uptrend phase, targeting the 7816 all-time high and possibly 8010.
- Similarities with previous strong rallies in 2026 warn of a strong melt-up rally. That would be against all odds given seasonality and the macro backdrop.
- The Fed's hawkish stance and strong economic projections shift focus to oil prices and yields as the next market catalysts.
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