Technical Update - S&P 500 stopped at key resistance, will it break it? Nasdaq 100 established short-term uptrend but it might be too fragile
Kim Cramer Larsson
Technical Analyst, Saxo Bank
S&P500/US500 testing strong resistance for further upside. It can be too strong to break and next couple of days will be key. Even if broken upside seems limited.
Nasdaq 100/USNAS100 lagging S&P500 but has established uptrend. An uptrend that seems fragile and can easily falter and slide back resuming bear trend
S&P 500 closed the gap Friday with a strong move higher. peeped just above the key resistance at around 3,807 only to close below. 0.382 Fibonacci retracement of the September sell-off is at 3,810. A close above needed to establish an uptrend.
RSI 14 is still below 60 threshold however, meaning it is still showing negative sentiment. If RSI is rejected at 60 the bear trend is likely to resume. If closing above, it is an indication of further upside momentum.
If S&P closes above 3,807, we could see a rally of another 100 points to strong resistance at 3,900.
55 and 100 SMA’s are coming down around that level i.e., the underlying sentiment is declining and will likely put a dampener on the possible uptrend. If that scenario plays out (that the Index closes above 3,807 and RSI above 60) S&P could run out of steam at the 0.618 retracement at around 3,879.
If S&P 500 slides back below 3,647 the bear trend will resume for lower lows. Look out ofr RSI breaking below its rising trendline
This morning the US500 cfd/S&P500 future is having another go at the 3,807 resistance. If US500 breaks above next resistance is at around 3,900.
A break below 3,630 is likely to lead to bear trend to resume. First indication of this scenario to play out could be RSI breaking below its rising trend line
Nasdaq 100 has broken out of its falling channel but closed below the upper resistance of the Gap. A close above 11,478 is needed for further upside. However, there are plenty overhead resistance if Nasdaq manages to close above 11,478.
11,660 would be key for confirmation of a new uptrend. An uptrend that could be cut short around 12K.
RSI is still showing negative sentiment and still has some way to for before reaching the positive sentiment threshold.
If Nasdaq 100 slides back below 10,962 bear trend resumes for lower lows.
USNAS100 cfd/Nasdaq future seems to establish a very short-term uptrend but key resistance will be at around 11,668. A close above will confirm this. IF the USNAS100 slides basck below 10,891 the bear trend is set to resume.
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