On Tuesday, markets saw consistent, gradual buying after the announcement of a cease fire between Israel and Iran. Major indexes climbed steadily, closing near their daily highs. No "sell the news" reaction has emerged, with investors poorly positioned for continued gains. Even optimistic bulls are seeking a pullback for better entry points.
Federal Reserve Chair Jerome Powell’s congressional testimony avoided a hawkish tone, aiding sentiment. He emphasized the Fed’s wait and see approach to rate cuts, noting that tariffs could drive inflation higher while job market conditions remain robust. Despite a notable decline, inflation remains slightly elevated, with forecasts for persistent price pressures posing challenges. Powell will reiterate his views before the Senate on Wednesday.
Market strength is largely driven by bears who, after months of expecting negative developments, find themselves mispositioned for the climbing indexes. Forced to cover losses, they’re fueling the rally. Bears banking on Powell’s forecast of higher inflation and slower growth have been poorly timed, needing significant declines just to break even.
Key events loom, including inflation data later this week, Trump’s NATO engagements, and Senate votes on a major budget bill. For now, all news is positive, and betting against the market’s momentum proves costly.
DAILY DINGERS
NVDA Nvidia Buy Range $146.18 - $148.97 and $153.13 - $155.00
Stock trading above early breakout buy point
RMBS Rambus Buy Range $63.15 - $65.00
Stock trading below breakout buy point
