The S&P 500 remains below 4200. Credit Suisse economists expect a potentially protracted consolidation / corrective phase to emerge with key short-term support still seen at 4.118 / 12.
Moving below 4.118 / 12 is necessary to mark a short-term top
“With a range of ‘red pennants’ and signals of overstretching still in place, as well as daily divergences of bearish momentum and a bearish MACD crossover to the downside, we continue to look for the development of what may be a prolonged consolidation / correction phase. “.
“While resistance from the top of yesterday’s price gap at the 4,188 / 93 ceiling, immediate risk may remain lower with support seen initially at 4,157 / 55 and then more importantly at 4.118 / 12, the low from the end of April and the bottom end of the uptrend since the beginning of March. However, a ceiling needs to be set down below to add weight to our supportive corrective roadmap to be seen below at 4,086, then 4,079, the 38.2% retracement of the late March rally. “
Above 4,193 should see strength return to 4209/12. A close above 4.219 may reaffirm the uptrend and end consolidation thoughts, with resistance to be seen next at 4.225 / 29, with tougher resistance expected at 4.259 / 60 ”.
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