S&P 500 starts slipping

The S&P 500 is one of the world’s most actively traded futures contracts, and lately has been pushing the 2000 mark quite strongly.

For a little while it was quite an attractive trade for many traders looking to scalp the band that had formed in the market. However, over the past few days since market openings we have seen the band breakdown and the scalpers start to drift away.

Previously we had a period of pressure and constant liquidity, and this remained quite strong in the markets for some time. Scalping was heavy during this period as traders look to play of strong support and resistance levels as the market had little to no direction.

This band of liquidity has since given way to a bearish channel which has started to form in the short to medium term.

This bearish channel at present is still quite wide, and markets have so far seen some aggressive pushes on it, to try and see if the bears are ready for a solid swipe. At present it looks likely we will see further pushes lower for the S&P 500, with strong support likely to be found at 1973.65.

The hourly charts also shows very strong support at 1976.64 and short term traders should target this level for profit taking as a well as the possibility of a pullback of it. In regards to resistance it can be found at 1983.75 and looks very strong in the current market climate.

With the US economy barrelling towards interest rate rises we may be on the cusp of seeing a minor correction in the S&P500. With all of this in mind, it’s likely we will see further falls and the trend is your friend in this case. Just be careful of key resistance and support levels as the S&P 500 has a tendency to bounce around between them.