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  • S&P 500 suffers heavy losses on flight-to-safety on Tuesday.
  • A daily close below 3,100 could cause the index to push lower.

Major equity indexes opened deep in the negative territory on Thursday with the CBOE Volatility Index, Wall Street’s fear gauge, rising nearly 15% to reflect the flight to safety. As of writing, the S&P 500 (SPX) was down 3.15% on the day at 3,089 points.

S&P 500 technical outlook

The 78.6% Fibonacci retracement of the sharp drop witnessed in March and the lower range of the April-May uptrend at 3,100 aligns as a critical level for the SPX. A daily close below that area could force the index to extends its slide toward 3,000 (psychological level/200-day SMA). 

Meanwhile, the Relative Strength Index (RSI) indicator on the daily chart is pushing lower toward 50, suggesting that sellers are taking control of the price action. 

On the upside, near-term resistances could be seen at 3,180 (Feb. 26 high/last week’s closing level/daily high) and 3,230 (June 8 high/June 9 high)

S&P 500 daily chart 

Additional technical levels

 

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