The S&P 500 is expected to see a fresh pullback from trend channel/Fibonacci resistance at 3980/84, even though the broader trend stays seen higher for 4070/75. Economists at Credit Suisse would become concerned about a more serious setback should bond sell-off start to accelerate dramatically further.
See – S&P 500 Index still have much further to rise for three reasons – Natixis
Key quotes
“With US yields and especially Real Yields moving sharply higher overnight we remain of the view the resistance at 3980/84 is likely to cap again for a fresh pullback into the range. This would be consistent in our view with our base case that the market remains in a choppier/slower trend higher. We would start to become concerned with respect to a more serious setback should the bond sell-off start to accelerate dramatically further.”
“Near-term support is now seen at 3954/50, then 3946, below which can see a deeper setback to the recent lows at 3915, which need to hold to prevent a near-term (minor) top. If seen though we would see support next and initially at 3899/97, then 3875.”
“A close above 3984 though can see the trend stay directly higher with resistance seen next at the psychological 4000 mark, then 4025. Big picture, we continue to look for a move in due course to our next flagged objective at 4070/75, from which we look for a fresh phase of consolidation.”
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