S&P 500 Technical Analysis | Forexlive

Despite
the threat of two more rate hikes this year, the S&P 500 keeps on finding
strong bids as the market expects a soft landing for the economy. The labour
market remains strong while the disinflation continues, and the latest US Consumer Confidence report
surprised to the upside. The market is taking good news as good news and
brushes aside any rate hike risk as long as the economy remains resilient. It’s
a shortened trading week as the US stock market closes early today and remains
closed tomorrow for Independence Day.

S&P 500 Technical
Analysis – Daily Timeframe

On the daily chart, we can see that we couldn’t
even get a pullback all the way back to the 4324 support where we
had also the 38.2% Fibonacci retracement level as
the S&P 500 bounced back strongly following the very strong data of the
Consumer Confidence report. Good data is giving the stock market a boost even
though it also raises the chances of the Fed hiking rates further. The price is
now back at the previous high at 4494.00 and if we see a break to the upside,
we will likely see another bullish wave into the 4628 resistance as there won’t
be anything standing in the way.

S&P 500 Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the surprising
consumer confidence report made the price to spike up breaking above the red 21
moving average and then
consolidate above it leading to a bullish crossover. After that, the buyers
started to slowly pile in and extended the rally as more good data came in such
as the better-than-expected US Jobless Claims and eventually the lower-than-expected
US PCE report last Friday. The moving averages will now act as dynamic support
for the buyers as they will look forward to a breakout and a rally towards the
next resistance at 4628.

S&P 500 Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that if we
were to get a pullback, a good support zone is the one near the trendline where
we will also find the Fibonacci retracement levels and the 4-hour red 21 moving
average. From a risk management perspective, that would be a better place where
to position long instead of trading the breakout now. For the sellers, on the
other hand, a good strategy should be waiting for the price to break below the
trendline to pile in and target the 4324 support.