- SPX500testing pivotal technical support zones- Prices exposed sub-2692
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The SPX 500 posted a largest single-day decrease given Feb 2nd with prices now coming vicious constructional support that IF broke, could fuel accelerated waste in a index. It’s make-or-break here and a concentration is on dual circuitously support targets to possibly offer support OR unleash a incomparable decrease in price.
SPX500 Weekly Price Chart
The SP 500 has been trade within a proportions of this extended descending pitchfork formation fluctuating off a 2015 2016 lows. Note that a reduce together converges on a Fibonacci connection during 2624/33 this week- watch a close.
SPX500 Daily Price Chart
Technical Outlook: A demeanour during daily cost movement shows a index resilient currently during a 2018 low-day tighten during 2617. This turn is corroborated closely by a connection of a 61.8% prolongation and a 200-day relocating normal around 2586/90– a mangle next this threshold could see things get disorderly in a hurry. Monthly open insurgency stands during 2718 with bearish cancellation set to 2744.
Note that a daily momentum form has exhibited a change in behavior given a start of a year with a pullback from overbought domain in late-January holding RSI sub-30. The successive miscarry found insurgency forward of 60 and casts a bearish opinion for prices. It’s value mentioning that we’ve been tracking a cost analog from a 1987 pile-up and if stream cost patterns hold, suggests a incomparable decrease is underway with a mangle next this support threshold.
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SPX500 240min Price Chart
Notes: A closer demeanour during intraday cost movement highlights countless slope formations that could be in play here. The concentration is on initial insurgency during a 50-line of a near-term slope off Feb / Mar highs with a risk reduce while next connection insurgency during 2692. Ultimately a crack above 2736/44 would be indispensable to change a concentration behind to a long-side.
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A mangle next a 2617 targets a pierce on 2586/89 – note that a median-line converges on this slope and serve highlights a technical significance. A tighten next this levels keeps a short-bias in play targeting a slope connection during around ~2530s corroborated by pivotal support during 2454.
Bottom line: The SPX500 is coming vicious support zones during 2617 and 2586– If one of these levels doesn’t furnish a sizeable recovery, risk markets could be staid for some critical losses.
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Other Setups in Play
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– Written by Michael Boutros, Currency Strategist with DailyFX
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