S&P 500 Technical Analysis | Forexlive

Yesterday,
the US CPI report
missed expectations across the board with unrounded figures looking even better. This led
the market to expect just one final hike at the July FOMC meeting as the labour
market remains tight and the Fed members didn’t hint to another skip after the
CPI release. Overall, the chances of getting a soft landing increased but now
will come the part when the market will have to be careful and watch out for
signs of too much slowing in economic growth.

S&P 500 Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the red 21 moving average acted as
dynamic support for the S&P 500 as the buyers leant on the moving average
to position for a breakout. The target now should be the 4628 level and after
that, the all-time high. If this breakout fails and the price falls quickly
back below the 4494 level, it would be an ominous signal for a fakeout, but at
the moment it looks like only ugly economic data can cause such an event.

S&P 500 Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the 4494 resistance coupled
with the trendline drawn on
the higher lows, formed an ascending triangle. A
breakout on either side generally leads to big moves afterwards as the momentum
increases and more buyers or sellers pile in. All else being equal, we should
see the S&P 500 rallying into the 4628 level in the next days and weeks.

S&P 500 Technical Analysis
– 1 hour Timeframe

On the 1 hour chart, we can see that we
may have a mini ascending triangle with the resistance standing at 4524. A
break above that level should see more buyers piling in and extend the rally
towards the 4628 level. Alternatively, if we get a pullback, we should see the
buyers leaning on the 4494 level where we have also a trendline for confluence. The
sellers, on the other hand, will want to see the price breaking below the 4494
level and the trendline to confirm the fakeout and pile in to extend the
selloff into the black trendline at 4440.

Upcoming Events

Today we have the US
Jobless Claims on the calendar and it’s likely that we will see a pullback in
case we see a big miss to the expectations and a rally in case the data beats.
Tomorrow, we conclude the week with the University of Michigan Consumer
Sentiment report.

See also the video below: