The S&P 500 has staged an impressive defence of key flagged supports at 3792/74 – the early February price gap and rising 63-day average – with strength having already extended to test its near-term downtrend at 3914/15. Notwithstanding, a move above here is needed to suggest the core uptrend has already resumed, economists at Credit Suisse brief.
See – S&P 500 Index: Rising rates indicates a serious shift in market outlook – Morgan Stanley
Key quotes
“Whilst our broader outlook stays bullish, we remain of the view a lengthier consolidation phase should still be allowed for prior to this core bull trend eventually resuming.”
“We look for 3914 to cap for now for a fresh pullback and ranging, with support seen at 3861 initially, then the upper end of the price gap from yesterday morning at 3843, which we look to try and hold. Below would warn of a retest of 3792/74, but with this expected to hold again.”
“Above 3914/15 would suggest the core uptrend may have already resumed for a test next of the 3929/34 highs of last week. Above here in due course can see a move back to the 3950/51 record highs, with 4070/75 our next core upside objective.”
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