Earlier this month, the S&P 500 hit new record highs, but now it seems to be taking a bit of a pause.
Currently, this well-known U.S. stock index is hanging out near a support zone, a spot that might tempt bullish investors to take the wheel again in the larger trend.
Curious about how the asset is performing on its daily chart?
The S&P 500 has pulled back from its recent peak around 6,150 as investors approach Nvidia’s earnings with caution, compounded by some lackluster economic data that fuels expectations of swifter Federal Reserve rate cuts.
It seems like a normal retracement in a larger upward trend, though the future direction is anyone’s guess. At present, the index hovers about 5,975, just below that all-important 6,000 mark that traders often fixate on.
A quick reminder: market prices are frequently influenced by fundamentals like directional biases and volatility. If you haven’t caught up with the U.S. stock market’s ins and outs, now’s the perfect time to consult the economic calendar and stay in tune with daily fundamental updates!
Interestingly, the 100-day Simple Moving Average (SMA) is sitting close to 5,850 and has been a reliable “floor” for the market since November 2023. Each time the index has hit this line over the past year, it has rebounded instead of breaking lower.
Right now, the 100 SMA aligns pretty closely with both the psychologically significant 6,000 mark and the Pivot Point at 5,981 on the daily chart.
For those rooting for the bulls, be on the lookout for long wicks dipping below the 100 SMA, bullish candlesticks, or consistent activity above 6,000. These might hint at new buying interest, potentially propelling the index back up to its previous high of 6,150, or maybe even beyond.
On the downside, if you start spotting red candlesticks or the index stays under the 100 SMA, we might witness a deeper retreat. The first area of interest would be around 5,850, but a further dip to 5,750, nearing the 200 SMA support, isn’t off the table.
Regardless of your trading inclination, always ensure you’re practicing effective risk management and staying alert to key catalysts that might sway overall market sentiment!
