S&P 500 refreshes all-time high, again
|The title of this post has been ‘on repeat’ for three weeks; that’s because the S&P 500 pencils in a fresh all-time high (ATH) each week!
January ended in unchartered territory, touching a fresh all-time high of 4,931 and adding +1.6%. This extended recovery gains from the near-test of monthly support coming in from 4,102 in October 2023. Recent posts by the FP Markets Research Team communicated that the index has been entrenched in a dominant uptrend since breaking out in early 2013, and aside from two sizeable corrections in 2020 and 2022, the uptrend has been one-sided.
Overthrown weekly channel resistance
Extended from the high of 4,607, channel resistance was unsaddled last week, pulling the index within striking distance of the widely watched 5,000 barrier. Sellers barely put up a fight at the channel resistance. While a bull trap could still unfold just north of it this week, a test of 5,000 is likely on the table before this takes shape, if at all.
Ultimately, the focus on the weekly timeframe this week will be on the area between 5,000 and the channel resistance. Breaking through offers at 5,000 supports additional outperformance, though a bearish move off 5,000 that forces a close back under the channel resistance could prompt profit-taking back to as far south as support at 4,743. The latter is supported by the Relative Strength Index (RSI) elbowing into overbought territory (note the monthly chart also shows early signs of negative divergence).
Daily support at 4,869 - 4,903?
Having noted the index refreshing all-time highs last week, entering at the high is seldom a good approach. Traders and investors tend to monitor for any correction within the trend to buy dips. On the daily timeframe, two areas of interest are calling for attention this week: the nearby daily support area at 4,869-4,903 and the previous ATH at 4,818. However, for buyers to commit to either support area, they’ll likely want to see the price reverse ahead of the 5,000 level or, alternatively, break the 5,000 base to run offers before retesting either of the two supports.
Source: TradingView
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.