S&P 500 Stabilizes at Some Interesting Levels
The S&P 500 ended March with a big bounce, and some new patterns have emerged for the key index.
First is a falling trendline along the highs of February. Prices briefly paused at this level on March 25 and 28 before breaking out. They returned to test and hold the line on April 1, which could mean old resistance has become new support.
Second, this line is flatter than the downtrend broken after the Federal Reserve meeting, which suggests bearishness is fading in the broader market.
Third, last week’s close roughly matched the early September high and the mid-December low. Will it now serve as support again?
Finally, the stabilization is occurring above the 200-day simple moving average (SMA).
Looking a little lower, traders may eye the early-March high around 4,417. It’s also near the 50-day SMA.
In conclusion, a new quarter has begun and earnings season is around the corner. Stocks face negativity because of inflation and slower profit growth. However investors keep putting money to work in new areas like Utilities (which broke out last week). They’re also returning to beaten-down growth areas like software, biotechnology and the Ark Innovation ETF. Is the S&P 500 climbing a “wall of worry” again?
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
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This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
First is a falling trendline along the highs of February. Prices briefly paused at this level on March 25 and 28 before breaking out. They returned to test and hold the line on April 1, which could mean old resistance has become new support.
Second, this line is flatter than the downtrend broken after the Federal Reserve meeting, which suggests bearishness is fading in the broader market.
Third, last week’s close roughly matched the early September high and the mid-December low. Will it now serve as support again?
Finally, the stabilization is occurring above the 200-day simple moving average (SMA).
Looking a little lower, traders may eye the early-March high around 4,417. It’s also near the 50-day SMA.
In conclusion, a new quarter has begun and earnings season is around the corner. Stocks face negativity because of inflation and slower profit growth. However investors keep putting money to work in new areas like Utilities (which broke out last week). They’re also returning to beaten-down growth areas like software, biotechnology and the Ark Innovation ETF. Is the S&P 500 climbing a “wall of worry” again?
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradingView is not affiliated with TradeStation Securities Inc. or its affiliates. TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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