The crucial level in the S&P 500

This year saw markets skip their customary little Thanksgiving rally. In its place, however, we saw a few very interesting trading days that helped to illustrate what is perhaps the key price level on the S&P 500 index: 2,632.

This level seems to be too strong for bears to penetrate despite several attempts over the course of last week. See the 30 minute chart below – the dark blue horizontal line at the chart's bottom sits right at this key level, with the chart showing bears beaten back at four points of contact.

At the time of this writing, the S&P 500 seems set to open approximately 1% higher, around 2,660. For this bounce to get further traction, the index must close the gap between 2,681 and 2,670.

If it fails, a re-test of 2632 is likely.