US STOCKS: Tops Out Above 6000, Looks Overdone In The Short-term

The ESM5 Overnight range was 5884.00 - 6008.00, Asia is currently trading around 5910. US stocks gave back all their gains overnight as a federal appeals court offered President Donald Trump a temporary reprieve. Month-end rebalancing would also have contributed to the price action as real money are expected to be sellers of equities and buyers of bonds.

• (Bloomberg) - “Trump pressed Fed Chair Jerome Powell to lower rates at their first in-person meeting since the president’s inauguration, the White House said.”
• “Hyundai is considering a 1% increase to the suggested retail price of every US model starting as soon as next week, people familiar said. The change for newly built vehicles, along with higher fees, would add several hundred dollars to each vehicle.”(BBG)
• "If traders really did think reciprocal tariffs were dead, we’d have seen a much bigger rally in stocks and the dollar and selloff in bonds because of the loss of tariff revenue."(BBG)
• Stocks could not hold above the 6000 area, the move looks overdone but momentum type funds and share buybacks have kept the market well supported.
• The price action yesterday continues to point to a market that is begrudgingly underweight, and this should continue to see dips supported.

• In the short-term though stocks are beginning to look overbought and a retracement would be healthy. The first buy-zone is back towards the 5600/5700 area where demand could be expected.

  Fig 1: SPX Daily Chart

  

  Source: MNI - Market News/Bloomberg