You may want to get your shopping lists ready because the Santa rally may come later than expected, but that doesn’t mean it won’t come. Just like that, the inauguration is almost here. In one week, Donald J. Trump will be sworn in (for a second time) as the 47th President of the United States of America. Markets are reflecting considerable uncertainty as the VIX hovers around 20, and the major stock market averages like the S&P 500 (SP500) test critical support.
How will the Trump administration handle the economic challenges? Inflation, the Fed, geopolitical factors, and so many other crucial issues persist. Rates are spiking, the dollar is surging, and it almost feels like Armageddon is here.
Meanwhile, there are many valid questions regarding what a Trump administration will mean for Main Street and Wall Street in future years. Despite the uncertainty, tax cuts, deregulation, fiscal stimulus, infrastructure optimization, improved trade agreements, easing monetary policy, and other growth-oriented initiatives should be beneficial to the general economy, and the stock market.
Therefore, despite the short-term pessimism and transitory increases in volatility, I remain constructive on high-quality U.S. stocks and other top assets. Also, I am keeping my year-end SPX target at 7,000.
Technically, The Bottom May Be Close
We’ve seen weakness in the SPX for over a month now, essentially since the post-election pop fizzled out. We’ve seen especially volatile and choppy trade in the last three weeks or so. This dynamic likely illustrates the market’s repricing of future rate cut expectations as well as digesting other non-standard elements like the transfer of power process, as well as rejecting the general uncertainty in the atmosphere.
The SPX should fill the gap from when the election wins rally started, bringing the major average down to about 5,700-5,800 support. This dynamic represents a mild
Are You Getting The Returns You Want?
- Invest alongside the Financial Prophet’s All-Weather Portfolio (2024 75% return) and achieve optimal results in any market.
- The Daily Prophet Report provides crucial information before the opening bell rings each morning.
- Implement my Covered Call Dividend Plan and earn 50% on some of your investments.
All-Weather Portfolio vs. The S&P 500
Join The Financial Prophet And Become A Better Investor!
Don’t Hesitate! Take advantage of the 2-week free trial and receive this limited-time 20% discount with your subscription. Sign up now and start beating the market for less than $1 a day!
Read the full article here
