S&P 500 is seeing near-term consolidation at the 4070/75 neighborhood. Although the rally is leaving the market in “typical” extreme territory, analysts at Credit Suisse see scope for the rally to extend further yet and look for a move to 4104/08 next and eventually to the 4200 level.
S&P 500 to stay bullish for 4104/08 next and eventually 4200
“Although the rally is beginning to leave the market at what we see as its ‘typical’ extreme – 15% above the 200-day average and also above daily, weekly and monthly Bollinger Bands – RSI momentum is only starting to get overbought and we continue to see scope for the rally to extend further yet.”
“Although a pullback should be allowed for our bias remains to look for further strength to Fibonacci projection resistance at 4104/07, then trend resistance from last November, today seen at 4114. We would look for this to cap at first for a pullback, but with a move above expected in due course for 4138 and eventually our 4200 Q2 objective.”
“Near-term support remains at 4057, with the price gap from Monday morning at 4034/20 ideally holding to keep the immediate risk higher. Below can see a deeper setback to 3993/73, but with fresh buyers expected here.”
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