S&P 500 Index: Recent strength seen as a bear market rally – Credit Suisse
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S&P 500 may see some near-term consolidation. Nonetheless, analysts at Credit Suisse remain of the view recent strength has been a bear market rally and look for a retest of key support from the 200-week average at 3620/19.
Scope for a near-term bounce
“S&P 500 managed a small rebound on Friday but with the market having been capped at and having rejected our recovery target of the late September high, falling 63-day average and 50% retracement of the fall from September at 3902/07 our bias is to view this as a temporary bounce only.”
“Resistance at 3796/3804 capping can keep the immediate risk lower for a fall back to 3698, then support next at the 3652/47 late October low ahead of a retest of the key 200-week average at 3620/19.”
“Above 3804 can see a deeper rebound to 3824 initially, then 3864, but with the 3890/3912 zone clearly expected to remain a major barrier.”
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