S&P 500 index bounced from 3,800 level – was it a reversal or just upward correction?
The S&P 500 index gained 1.49% yesterday, as it retraced some of the recent declines. It went closer to the 3,900 level again after bouncing from Tuesday’s new local low of 3,795.62. On Tuesday the markets were very volatile, but they didn’t extend their declines. Recently the S&P 500 reacted to last week’s Wednesday’s FOMC interest rate hike, among other factors.
Today stock prices are expected to open 0.8% lower after better-than-expected economic data releases (Final GDP, Unemployment Claims). In early December the S&P 500 index broke below its two-month-long upward trend line and it moved sharply lower after getting back to that line last week, as we can see on the daily chart:
Futures contract trades below 3,900
Let’s take a look at the hourly chart of the S&P 500 futures contract. Yesterday it broke above the 3,900 level, but this morning it’s trading lower again. The support level remains at around 3,800.
Conclusion
The S&P 500 index will likely open 0.8% lower this morning. Stocks bounced on Wednesday, but today we may see some more uncertainty and a sideways trading action. There have been no confirmed positive signals so far. However, stocks may be forming a bottom here.
Here’s the breakdown:
-
The S&P 500 index retraced some of its recent declines yesterday.
-
Stocks will likely extend their short-term consolidation ahead of a holiday weekend.
Want free follow-ups to the above article and details not available to 99%+ investors? Sign up to our free newsletter today!
All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' employees and associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Recommended content
Editors’ Picks
AUD/USD stands firm above 0.6500 with markets bracing for Aussie PPI, US inflation
The Aussie Dollar begins Friday’s Asian session on the right foot against the Greenback after posting gains of 0.33% on Thursday. The AUD/USD advance was sponsored by a United States report showing the economy is growing below estimates while inflation picked up. The pair traded at 0.6518.
EUR/USD mired near 1.0730 after choppy Thursday market session
EUR/USD whipsawed somewhat on Thursday, and the pair is heading into Friday's early session near 1.0730 after a back-and-forth session and complicated US data that vexed rate cut hopes.
Gold soars as US economic woes and inflation fears grip investors
Gold prices advanced modestly during Thursday’s North American session, gaining more than 0.5% following the release of crucial economic data from the United States. GDP figures for the first quarter of 2024 missed estimates, increasing speculation that the US Fed could lower borrowing costs.
Ethereum could remain inside key range as Consensys sues SEC over ETH security status
Ethereum appears to have returned to its consolidating move on Thursday, canceling rally expectations. This comes after Consensys filed a lawsuit against the US SEC and insider sources informing Reuters of the unlikelihood of a spot ETH ETF approval in May.
Bank of Japan expected to keep interest rates on hold after landmark hike
The Bank of Japan is set to leave its short-term rate target unchanged in the range between 0% and 0.1% on Friday, following the conclusion of its two-day monetary policy review meeting for April. The BoJ will announce its decision on Friday at around 3:00 GMT.