⏬US500 deepens month-end declines

US500 deepens month-end declines and halves the recent upward wave

August ends very poorly for the stock market. The S&P 500 is likely to end the month with about a 4% decline, although from the monthly peak the declines are close to 8%. The rebound that began in June, due to the so-called "Fed Pivot," has been halved to an increase of about 9%.

Why the recent declines? It's the valuation effect of strong hikes in the US. There is a chance of a 75bp hike in September in the US and hikes this year to as high as 4%. Data from the US is not doing badly, but there are suggestions that the labor market will very soon begin to reflect the coming recession.

It's worth noting that it's not just Wall Street that has leveled the rebound due to expectations of a less tight Fed. Gold returned to the $1,700 area, and oil in the last session significantly reduced the biggest upward correction in the last few months.

The US500 is deepening declines on the back of rising yields. The 50.0 retracement of the last upward wave is currently being tested, but the US500 has fallen below important support points, namely the 4,000-point level, the 100-period average and finally the 50-period average. The next target of the current declines may be located at the 61.8 retracement. In case of a recovery, the most important resistance is located in the area of 4050 points at the 100-period average. Source: xStation5