S&P 500 at new medium-term highs – Is correction coming?

Paul Rejczak Gold Price Forecast

The S&P 500 accelerated its rally yesterday – will it continue even higher?

The broad stock market index gained 1.22% on Thursday as it further extended its uptrend after breaking above the previous local highs two weeks ago. The S&P 500 was the highest since April of 2022 again.

There is still a lot of uncertainty concerning monetary policy, some technology stocks’ valuation concerns, but overall, the investors’ sentiment is still bullish.

Stocks will likely open 0.2% higher this morning as investors’ sentiment remains bullish ahead of a long holiday weekend. The S&P 500 is trading above its month-long upward trend line and above a steeper short-term trend line as we can see on the daily chart:

Futures contract trades along new high

Let’s take a look at the hourly chart of the S&P 500 futures contract. It rallied up to around 4,485 level yesterday. Today it’s trading within a short-term consolidation. The resistance level is now at 4,500 and the support level is at 4,440, among others.

Conclusion

The S&P 500 index will likely open higher this morning. The market may fluctuate following its recent rally. There have been no confirmed negative signals so far. However, stocks may see a profit-taking action at some point.

Here’s the breakdown

The S&P 500 extended its rally as it broke above the 4,400 level yesterday.
There have been no confirmed negative signals so far.
In my opinion, the short-term outlook is bullish.

Want free follow-ups to the above article and details not available to 99%+ investors? Sign up to our free newsletter today!

Author

Paul Rejczak

Gold Price Forecast

Paul Rejczak is a stock market strategist who has been known for the quality of his technical and fundamental analysis since the late nineties.

EUR/USD holds ground near 1.1550 ahead of US Inflation data

EUR/USD is holding ground at around 1.1550 in the European session on Wednesday. The pair takes advantage of the profit-taking pullback in the US Dollar as traders reposition ahead of the critical US CPI inflation data. However, any upside attempts could be limited amid renewed US-Iran tensions.

GBP/USD keeps range near 1.3400, with eyes on US CPI

GBP/USD clings to minor recovery gains near 1.3400 in Wednesday's European trading, though it remains in a familiar range heading into the US CPI event risk. Traders keep an eye on developments around the Middle East crisis, which could ramp up volatility in the major.

Gold languishes near March low, below $4,200 as traders await US CPI report

Gold maintains its heavily offered tone through the first half of the European session and currently trades near its lowest level since March 23, around the $4,180-$4,175 region. Renewed hostilities between the US and Iran fuel inflationary concerns and bolster bets for more hawkish central banks.

Cardano's downtrend deepens despite on-chain bottoming signals

Cardano edges lower to $0.1600 signaling a potential extension of the 30% loss from last week. The altcoin remains under intense selling pressure, weighing on its retail support. Still, a spike in dormant supply re-entering circulation signals that the selling pressure has run its course, a pattern that often precedes a rebound.

US CPI data set to show inflation at three-year high in May, backing Fed hawkish tilt

The US Bureau of Labor Statistics will publish the May Consumer Price Index (CPI) data on Wednesday. The report is expected to show another step up in consumer inflation, driven by the persistently high Oil prices due to the ongoing crisis in the Middle East.

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.