S&P 500 Technical Analysis | Forexlive

Last
Friday, the S&P 500 pulled back as a hot US PPI report
weighed on the market. In fact, the Treasury yields rose, and the rate cuts
expectations got trimmed some more as fears of stickier inflation started to
creeping in. The Fed members though keep on dismissing the latest figures as
something expected and continue to repeat that the disinflationary trend
remains intact. This suggests that the Fed is not even considering rate hikes
and in the worst-case scenario could just delay rate cuts. The market might
continue to like this as long as the economic data remains good. Today the
market will be closed for the Presidents Day and will resume trading tomorrow.

S&P 500 Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the S&P 500
last Friday fell into the close following a hot US PPI report. The market
recently bounced on the trendline as the
buyers continue to pile in at every pullback to position for new all-time
highs. The sellers should wait for the price to break below the trendline and
the red 21 moving average before
even considering shorting this market.

S&P 500 Technical
Analysis – 4 hour Timeframe

On the 4
hour chart, we
can see that we had also the 61.8% Fibonacci
retracement level adding extra confluence around
the trendline. There’s not much to glean from this timeframe so we need to zoom
in to get some more details.

S&P 500 Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we
have a support zone
around the 4995 level where we can find the confluence with the red 21 moving
average and the 38.2% Fibonacci retracement level. This is where the buyers
will likely pile in again with a defined risk below the trendline to position
for a new all-time high. The sellers, on the other hand, will want to see the
price breaking below the trendline to position for a drop into the 4923 level
and in case of a break lower, target the 4846 level next.

Upcoming Events

This week is basically empty on the data front with just
the release of the FOMC Meeting Minutes on Wednesday followed by the US Jobless
Claims and the US PMIs on Thursday.