S&P 500 Index to test the major support centered on 3209 – Credit Suisse


S&P 500 has seen a sharp fall on high volume, breaking below the uptrend from June to increase the risk that the market may be forming a double top. Only below 3209 the index would see the double top confirmed, but if seen, it would open the door for a move to the 200-day average at 3130, per Credit Suisse. 

Key quotes

“The S&P 500 has gapped sharply lower on markedly increased volume for a break below its uptrend from mid-June and whilst the market remains in its range from September for now, current price action increases the risk we may now in fact being seeing a more important topping process. This is seen reinforced further when we look at the weekly RSI momentum which looks to be already holding a large ‘head & shoulders’ top should we close the week at these levels, which is clearly concerning given momentum tends to be a leading indicator.” 

“Whilst resistance at 3306/11 caps the immediate risk is thus seen lower with support below 3269 seen at 3228 next, then more importantly at 3209/3199, which includes the key September low. Whilst we look for an attempt to hold here, a clear and closing break would suggest we have seen a significant top established, exposing the 200-day average, currently at 3130.” 

“Above 3311 can see a recovery back to 3342, potentially 3365, but with fresh sellers expected here.” 

“The VIX above 38.28 sees a much larger base complete to warn of a more significant rise in volatility with resistance next at 44.44.”

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

AUD/USD wavers below 0.7300 ahead of Aussie Trade Balance

AUD/USD fades pullback from 0.7264 after marking another failure to cross 0.7340 on D1 closing. DXY rebounds from a 12-week low as US PMIs performed better than EU data in November. Australia’s preliminary Trade Balance for October, RBA’s Debelle can offer immediate direction.

AUD/USD News

Gold in bearish consolidation below $1840, remains vulnerable

Gold (XAU/USD) is nursing losses in Tuesday’s Asian trading, having slumped 2% on Monday to reach the lowest levels in four months at $1831. Vaccine progress, stronger US data hammer gold prices. Focus on vaccine updates and risk sentiment for fresh impetus.

Gold news

USD/JPY regains 104.50, could extend recovery

The USD/JPY pair hit a one-week high of 104.63 and is set to extend gains on persistent dollar’s strength. The positive tone of equities provide additional support to the pair.

USD/JPY News

Bitcoin risks a correction to $12,000

Peter Brandt, author, and publisher of the Factor Report, has exited around 50% of his Bitcoin position. The veteran trader believes Bitcoin might be poised for a correction to $12,000 in the near future.

Read more

Black Friday 2020 Discounts!

Learn to trade with the best! Don't miss the most experienced traders and speakers in FXStreet Premium webinars. Also if you are a Premium member you can get real-time FXS Signals and receive daily market analysis with the best forex insights!

More info

Forex MAJORS

Cryptocurrencies

Signatures