S&P Under Microscope
By examining the daily charts, we can see that the index is trading within two upside channels, where the main upside channel, which is controlling the index’s general trend since the trough at 665.75, and the minor upside channel, which is controlling the short term upside trend, as shown in the image below.
We can see that the 76.4% Fibonacci level stopped the index from rising further, and caused a downside rebound towards the support of the minor upside channel, and we can clearly see that a downside technical model has been formed, where its neckline overlapped a retest level for an upside technical model that was completed earlier at 1330
Nonetheless, the downside technical model didn’t continue, since the SMA 50 stopped the downside wave and provided strong support for the index to rise back to the upside and try to settle above the critical level at 1330.
The Stochastic indicator is providing positive signals, in addition to the positive technical factors mentioned above- the price channels and the SMA 50-, we expect the index will continue its upside general trend, and the next target is to breach the 76.4% Fibonacci level at 1368.50 and then head towards the 1425.00 followed by the psychological level at 1500.00.
On the other hand, we should note that breaching the 1305.00 will open the way for more downside movements towards the support of the main upside channel between 1216.00 and 1233.00.
Georgia Anderson` Financial News Network, trader, trader education, online forex, daytrader,forex currency, forex software, investors, forex trading, forex