Will S&P 500 continue higher?

The S&P 500 index gained 0.39% on Monday as it slightly extended its Friday’s advance of 0.4%. The daily high was at 4,623.71 and it was the highest since late March of 2022. Investors’ sentiment is still bullish despite interest rates uncertainty, mixed economic data.

Recently the S&P 500 broke above the resistance level marked by the technically important August 2 daily gap down of 4,551-4,568. The market resumed its rally from October 27 local low of 4,103.78. On Friday it broke slightly above its July local high of 4,607.

Stocks are expected to open 0.1% higher this morning after the important Consumer Price Index release. It was at +0.1% m/m vs. the expected 0.0%. So there may be a sideways trading action and an uncertainty following recent advances. The market will be waiting for the important FOMC Statement release tomorrow. S&P 500 is trading above 4,600 level as we can see on the daily chart:

Futures contract traded closer to 4,700

Let’s take a look at the hourly chart of the S&P 500 futures contract. It went closer to 4,700 level after the inflation data, but right now it’s trading within its overnight price range. The support level is at 4,600-4,630, and the resistance level is at 4,700.

Conclusion

The S&P 500 index is expected to open 0.1% higher following important CPI release. Yesterday it broke above the recent trading range and its yearly high from July.

There have been no confirmed negative signals so far, but the market may see a downward correction at some point.

Here’s the breakdown:

• The S&P 500 trades above 4,600 level and it remains the highest since March of 2022.

• There may be a downward correction at some point.

• In my opinion, the short-term outlook is still bullish.

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