The S&P 500 index gets closer to the 4,500 level again. So is this a new uptrend or still just an upward correction following the recent declines?
The broad stock market index lost 0.06% on Wednesday following Tuesday’s advance of 1.6%. Stocks were gaining ahead of quarterly earnings releases. So far, we’ve seen some mixed reactions to those releases. There’s still a lot of uncertainty concerning the Ukraine conflict and the Fed’s monetary policy tightening plans. However, we may see an attempt at breaking above the 4,500 level.
The nearest significant resistance level is now at around 4,500, marked by the recent support level and last Monday’s daily gap down. On the other hand, the support level is at approximately 4,350-4,400. The S&P 500 index broke above its downward trend line, as we can see on the daily chart:
(chart by courtesy of http://stockcharts.com):
Futures Contract Just Below Important 4,500 Level
Let’s look at the hourly chart of the S&P 500 futures contract. On Tuesday, it broke above its short-term downward trend line, and it retraced some of the recent declines. The market gets close to the 4,500 resistance level.
Recently, we closed a speculative long position with a gain of 100 points. (our premium Stock Trading Alert includes details of our trading positions along with the stop-loss and profit target levels).
(chart by courtesy of http://tradingview.com)
Conclusion
The market should get close to the 4,500 level and we may see some buying pressure if the index breaks above it. Investors will be waiting for more quarterly earnings releases, plus we will get speeches from the Fed Chair Powell today.
- The S&P 500 index will likely extend its short-term uptrend today; a breakout above the 4,500 level may fuel additional rally.