Weekly Stock Market Update & SPY Technical Analysis
Investors are gearing up for a highly eventful week ahead, filled with key economic data and updates from Federal Reserve officials.
Several Fed members will deliver speeches and share their latest views on economic activity. More importantly, Fed Chairman Jerome Powell is set to testify before Congress in a two day event on Tuesday and Wednesday, his first appearance since July 2024. Markets often experience heightened volatility during live speeches, so stay vigilant and be prepared for some uncertainty.
Inflation data will also be a major focus this week, with both the Consumer Price Index (CPI) and Producer Price Index (PPI) set for release. Inflation has been the biggest challenge for the U.S. economy over the past two years, severely impacting consumer sentiment and spending power. In response, the Fed raised interest rates to curb rising prices, successfully bringing inflation down from a peak of 9% to below 3%. While the Fed's goal is to lower inflation to 2%, progress has been slower than expected, and newly imposed tariffs by the Trump administration have added further complexity to an already challenging fight.
On a positive note, inflation is expected to decline from last month’s reading of 2.9% to a slightly improved 2.8%. Additionally, the U.S. unemployment rate, another key economic indicator, fell to 4% in last week’s report. The inflation data released this week may act as the catalyst that finally breaks markets out its range trading.
SPY Technical Analysis:
Investors have a bit of whiplash from the large upside and downside swings markets have seen lately, but despite the increase in volatility, the general trend has remained bullish. Buyers have been quick to buy every dip, and major indexes have not broken below key levels. There’s a likely chance that investors are just digesting recent changes from Trump and releases of earnings before injecting more cash.