After a Record High of the S&P 500 Index, Bearish Sentiment Sets In

S&P 500 Index Price Analysis – January 7

The risk appetite returned with a vengeance when the S & P 500 posted its most significant intraday reversal in three months as investors looked at past concerns about escalating tensions in the Middle East, focusing on reliable US economic data.

Key Levels
Resistance Levels: 3,350, 3,300, 3,263
Support Levels: 3,157, 3,069, 2,853

S&P 500 Index Long term Trend: Bullish

The overbought scenario has already been discovered since the RSI has been leveling about 70 – 75 levels for more than a week and moving averages are going to turn south after the attempt of the peak against the upper resistance horizontal level.

Slowing the trend further increases the likelihood of a downward correction, or at least some stabilization.

S&P 500 Index Short term Trend: Bullish

Sellers would like the price to fall beneath the previous resistance turned support on the level at 3,157 and the uptrend line to reduce the impact on the market.

Breaking beneath December level at 3,069 and, more importantly, beneath the same support level at 3,026, the door will open for the moving average of 5 and 13 which is around the lower barrier of the horizontal zone.

Instrument: S&P 500 Index
Order: Buy
Entry price: 3,207
Stop: 3,157
Target: 3,300

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