Investors hold to their longs as a "drowning man to a straw". What Wall Street have for us

It is obvious that this fake, despairing optimism that investors have caught will dominate the US markets - at least during the first hours of the cash session.

Yes, yesterday the indexes recorded one of their better sessions for this year, but an important ingredient makes the difference between yesterday and today - the vanguard trading volumes.

As can be seen from the graph, net cash flows remain low and trading volumes remain far below yesterday's (as well as below average) levels.

After the start of the day, King USD has returned and dominates the FX market - another reason not to fully trust that we will get a new strong Wall Street day. Bond yields rise with gold, which makes us think that the strength of the dollar is not accidental.

The real reason for the rise of the indexes is the key support that they found in the 200-MA on daily chart in combination with the S&P 500 double bottom formation. For a technician - this may be enough for the LONG - but the real question here is - how long he will continue. Will we see a new peak in indexes soon?

The answer to this question is Washington. Optimists will say Trump will make a good deal with China and all the fears will be in vain. Yes, but Mr Mr.'s main worries President is the trade deficit between the two countries - which he thinks will most easily melt away by imposing tariffs. Despite the fact that traders are catching straws and looking for a reason for ling - the foundation says things are not as pink as they look.

Markets are currently on the loop, but investors remain timidly cautious.

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