S&P 500 has spiked to new 2022 highs two days in a row but has so far not managed to close above the Evening Doji top and reversal pattern (circled on the chart). To do that it requires at close above 4,579
But maybe today is the day it will do just that. Pre-market the S&P 500 future and the US500 cfd (see daily chart further below) are trading around 4,600 lifted by Meta trading +8% in Pre-Market after earnings release After Hours.
If S&P 500 is closing at or above 4,579 the top and reversal pattern has been cancelled and the Index is set for higher levels. Resistance at around 4,637.
However, there is divergence on RSI, MACD and traded volume. RSI and MACD values are declining and so is traded volume i.e., Divergence or imbalance in the market. In other words the uptrend is fragile and weakening. It is a warning sign but not a reversal signal.
If RSI closes above 76.36 the divergence is cancelled supporting even higher Index highs.
If buyers fail to close S&P 500 at or above 4,579 a correction will almost be a given. Support at around 4,455. First indication of a trend reversal would be a bearish break of the very short-term lower rising trendline