Apart from a brief and shallow dip, the S&P 500 treated the Powell testimony as a non-event. High yield corporate bonds (HYG ETF) keeps trading relatively unchanged from yesterday's closing prices, while stocks are trading just above the 61.8% Fibonacci retracement hours later.

And they did bounce higher every time they've approached it earlier today. Technology is leading higher today, while healthcare is down and financials are going sideways. We better not expect any kind of a sizable move today from energy, materials and industrials as a group.

Where does that leave us for tomorrow? As today is likely to result in a close above 2940, Wednesday's data-light day would probably conclude with the third close above the 61.8% Fibonacci retracement. That would be a confirmed breakout above this resistance, after which the bulls would target the 200-day moving average at around 3000.

Acting on this scenario means that it would be justified to get long. But given the low volatility throughout today, it makes sense to aim for a microrotation to get us in at a slightly better price that is the case currently. Please see the trading position section for full details.

Trading position (short-term; our opinion): long positions (100% position size) entered via a limit buy order at 2941 with stop-loss at 2580 and the initial upside target at 3125.

Thank you.

Monica Kingsley
Stock Trading Strategist
Sunshine Profits - Effective Investments through Diligence and Care