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Above 3429/44, the S&P 500 Index marks the completion of a “head & shoulders” base for a resumption of the broader core uptrend back to the 3588 high and eventually beyond, according to the Credit Suisse analyst team. 

Key quotes

“A pause and neutral ‘inside range’ day as suspected following the strong move higher, but with a ‘head & shoulders’ base in place above key resistance from the mid-September highs and 61.8% retracement of the fall from September at 3429/44 dips will stay seen as corrective and we maintain our bullish outlook and look for strength back to not only the 3588 record high, but beyond in due course.” 

“We see resistance above 3550 at 3565 next and eventually the 3588 high, also essentially the upper end of its ‘typical’ extreme (15% above the 200-day average). Whilst this should clearly be respected we look for a break in due course with the ‘measured base objective’ at 3653.” 

“Support moves to 3500 initially, with the lower end of the recent price gap at 3482/77 ideally holding to keep the immediate risk higher. A break can see a deeper pullback to 3458/47, but with fresh buyers expected here.”