On Friday 9 June, the American Nasdaq Intraday dropped with more than 3%. The American S&P500 restricted itself to a little over one percent.
Noteworthy, considering investors are only used to an increase of 3%.
Europe seemed to pass up on this drop and as the week went on, the Nasdaq was on its way to compensate for the price drop. The volume remained sub par, since everybody was waiting on the decision of the American Central Bank.
Third increase in half a year
On Thursday 14 June, the American Central Bank raised its most important interest with 25 basis points. The market had expected this, but this is the third increase in half a year’s time. The substantial balance of 4,200 billion dollars is also being scaled back as of this year. This concerns a total of 50 billion dollars per month.
On the short term, financial markets would rather see different measures, but it is a fact that the American economy is performing better.
After the accouncement, the joy did not last long and the Nasdaq and S&P500 once again was at the same level as it was on Friday 9 June. On the left, you can see the daily graph over the previous year, to the right the four-hour graph over the previous two months.
Still green
The market sentiment still quotes in green. If, however, the S&P500 breaks through 2,390 points, this will not bode well for trend investors. The market sentiment can turn rather quickly as a result.
Summer will be upon us next week, which means the price-supporting volume will decrease. For your security it might be interesting to check your stoploss levels. The steep and abrupt drop of Friday last week shows an increasing interest in profit-taking.
Healthy correction
Finally, it is better and safer for every long-term investor that the S&P500 corrects healthily and forms a solid bottom again. The S&P500, the trendsetter for shares the world over, has risen with 20% since 2016…
