S&P 500 Technical Analysis

Last week, the S&P 500 got under pressure amid
geopolitical fears and a general risk off sentiment. The latest developments
saw Israel retaliating against Iran but the latter downplaying the airstrikes.
This episode might be behind our backs, although it’s worth to keep an eye on
it if it were to become a concern again. On the macro side, the Fedspeak turned
more hawkish, especially in the latter part of the week as the inflation
progress looks to be stalled. Overall, the last week had plenty of bearish
catalysts weighing on the market, so we will probably need some positive data
on the inflation front this week to turn the sentiment around.

S&P 500 Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the S&P 500
continues
to rollover with the trend now looking clearly bearish as the price keeps on
printing lower lows and lower highs with the moving averages being
crossed to the downside. The price has now reached another key support level
at 4946. This is where we can expect the buyers to step in with a defined risk
below the level to position for a rally into the new highs. The sellers, on the
other hand, will want to see the price breaking lower to increase the bearish
bets into the next support at 4846.

S&P 500 Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that from
a risk management perspective, the sellers will have a much better risk to
reward setup around the previous support now turned
resistance at 5057 where they will also find the confluence of the
red 21 moving average and the 38.2% Fibonacci
retracement level. The buyers, on the other hand,
will want to see the price breaking above the resistance to invalidate the
bearish setup and position for a rally into a new all-time high.

S&P 500 Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we
have a minor black trendline
defining the current downward momentum with the red 21 moving average acting as
dynamic resistance. This is where we can expect the sellers to step in again if
we get a pullback into the trendline to position for a break below the 4946
support. The buyers, on the other hand, will want to see the price breaking
higher to pile in and target a rally into the 5057 resistance.

Upcoming Events

This week is a bit empty on the data front with just a
few notable releases. We begin tomorrow with the US PMIs. On Thursday, we get
the US Q1 GDP and the latest US Jobless Claims figures. On Friday, we conclude
the week with the US PCE report.

This article was written by FL Contributors at www.forexlive.com.