The S&P 500 strong recovery continues but for now, we continue to look for a high-level consolidation phase to emerge ahead of an eventual move to 3900.
See: Reddit-fuelled trades of last week sees astonishing rallies plummeting once again – Deutsche Bank
Key quotes
“A strong recovery for the S&P 500 has seen the market remove resistance from the price gap from last Friday morning and the midpoint of the ‘real body’ of the bearish ‘reversal week’ at 3778/87, leaving the market testing what we see as more important resistance at the 3837/50 price gap. With a large bearish “reversal week” in place our bias remains for this to cap for now for a phase of high-level consolidation.”
“Support is seen at 3813 initially, then the price gap from yesterday morning at 3792/73. Below here is needed to reinforce a sideways ranging phase for a fall back to 3726, then more important support, starting at 3694 and stretching down to the low for the year at 3663.”
“Above 3850 though would increase the risk the setback may already be over for a move back to the 3871 high and eventually our long-held 3900/04 ‘measured triangle objective’ also now trend resistance from November.”
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