Best analysis

The S&P 500 future is pointing to a flat open on Wall Street today, following on the uninspiring sessions in Europe and Asia Pacific overnight. So far today we haven’t had any major market-moving news or data to encourage the market participants to establish any bald positions. But that could change later on with the release of some important US macroeconomic pointers. Still, with the FOMC meeting coming up next week, the markets may quickly brush off any surprises. Retail sales are expected to have bounced back 0.3% in August after a flat July. Core sales are likewise seen improving a touch. The outcome of the UoM consumer sentiment survey is expected to show some improvement to 83.2 at the start of this month from 82.5 previously. And business inventories are estimated to have risen 0.5% in July, up from 0.4% the month before.

Meanwhile the technical outlook for the S&P remains bullish, as things stand. Last week, the index rallied to a fresh all-time high of 2012 before slowly pulling back from there due to the lack of any supportive fundamental stimulus. But the selling has, for now at least, stalled around the resistance-turned-support level of 1985 which is a bullish development in my view. For as long as the buyers manage to hold their ground here on a daily closing basis, the path of least resistance would remain to the upside. Today, they will need to push the index above resistance and psychological level of 2000 in order to encourage fresh buying at these elevated levels, especially with the weekend fast approaching. Failure to do so could lead to further profit-taking later in the afternoon. If and when last week’s record high is breached, the bulls may then target 2018 and possibly even 2051. These levels correspond with the 127.2 and 161.8 percent Fibonacci extension points of the corrective move we saw from July to August (i.e. the move from point A to B on the chart).

O the bears will be hoping to see the S&P break the 1985 support level, preferably on a closing basis. If they do, a move down to the 50- or even the 100-day moving averages, at 1972 and 1946, could be on the cards soon. Traders will also want to watch some of the Fibonacci levels (of the BC rally) for support, especially the 38.2 and 61.8 percent levels at 1967 and 1940 respectively. They would be encouraged by the fact that the bullish momentum appears to be fading a touch: the RSI, for example, has failed to create a higher high like the underlying index which suggests the momentum may be shifting in the bears’ favour.

Trading Analysis Corner

Trading leveraged products such as FX, CFDs and Spread Bets carry a high level of risk which means you could lose your capital and is therefore not suitable for all investors. All of this website’s contents and information provided by Fawad Razaqzada elsewhere, such as on telegram and other social channels, including news, opinions, market analyses, trade ideas, trade signals or other information are solely provided as general market commentary and do not constitute a recommendation or investment advice. Please ensure you fully understand the risks involved by reading our disclaimer, terms and policies.

Recommended Content


Recommended Content

Editors’ Picks

AUD/USD recovers further toward 0.6800 on risk-recovery

AUD/USD recovers further toward 0.6800 on risk-recovery

AUD/USD extends recovery toward 0.6800 in Asian trading on Thursday, despite mixed Australian employment data. The Aussie cheers a return of risk appetite, which weighs on the post-Fed US Dollar recovery. All eyes now remain on US economic data for fresh impetus. 

AUD/USD News
USD.JPY reverses sharply from 144.00, as US Dollar recovery fizzles

USD.JPY reverses sharply from 144.00, as US Dollar recovery fizzles

USD/JPY is attacking 143.00 in Thursday's Asian session, reversing sharply from 144.00. The pair pares back gains in tandem with the US Dollar, as the latter's post-Fed recovery falters due to a rebound in risk sentiment. The focus is next on the US data due later today and Friday's BoJ decision. 

USD/JPY News
Gold defends $2,550 in the Fed’s aftermath, ahead of US data

Gold defends $2,550 in the Fed’s aftermath, ahead of US data

Gold price is defending $2,550 early Thursday, catching a breath after intense volatility witnessed in the aftermath of the all-important US Federal Reserve monetary policy announcements and Fed Chairman Jerome Powell’s press conference.

Gold News
Bitcoin surges to $62,000 mark after 50 bps Fed rate cut

Bitcoin surges to $62,000 mark after 50 bps Fed rate cut

Bitcoin and Ripple eye for a rally as they break and find support around their resistance barrier. Meanwhile, Ethereum demonstrates signs of recovery as it approaches a critical resistance level, indicating that an upward rally could be on the horizon if it successfully breaks through.

Read more
Australian Unemployment Rate expected to hold steady at 4.2% in August

Australian Unemployment Rate expected to hold steady at 4.2% in August

The Australian Bureau of Statistics will release the monthly employment report at 1:30 GMT on Thursday. The country is expected to have added 25K new positions in August, while the Unemployment Rate is foreseen to remain steady at 4.2%.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Majors

Cryptocurrencies

Signatures