The S&P 500 Index saw an intraday break of the yearly low of 4,115, but the market held the next marked support from the May 2021 lows at 4,061/57. With tomorrow’s FOMC, Credit Suisse economists they suspect the market stalls for now, but with the broader risk still seen lower.
Resistance for recovery is seen at 4,170 initially
“With the daily RSI momentum failing to confirm the latest move to new lows and with the market managing to close back above 4,115 in conjunction with the key FOMC announcement on Wednesday, we suspect we are likely to see the market hold for now. In fact, we would not rule out a new phase of consolidation”.
“In the bigger picture, our bias remains lower and we look for a sustained break of the Q1 low of 4,115 in due course to drop back to 4,063/57. Below here you can see support ahead at the 50% retracement of the rally from Oct 2020 at 4,026 and finally we think the 38.2% retracement of the entire 2020/2021 uptrend at 3,855/15”.
“Resistance for the recovery is initially seen at 4,170, above which strength back to 4,208 can be seen, then the 38.2% retracement of the sell-off from late April at 4,235. Stronger resistance is expected at the 13-day exponential moving average and 4,270/88.”
Source: Fx Street
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