U.S. Indices Rebound: Support In View For The S&P 500

In the wake of the first two-day losing streak of 2018, both the DJIA and S&P 500 have posted strong opens to the session.


The rollercoaster ride continues for the U.S. indices. In the wake of the first two-day losing streak of 2018, both the DJIA and S&P 500 have posted strong opens to the session. As of this writing, the DJIA is up over 200 points and the S&P 500 up nine.

It is a charged news cycle, with the FED taking center stage a bit later on today and President Trump giving his State of the Union Address last night. Thus far, it appears that early-week skepticism toward equities has been replaced by the bullish sentiment of the pro-business Trump administration.

S&P 500 Technicals

For the first time in quite a while, the E-mini S&P 500 futures contract is posting a considerable retracement. A long entry from downside support may be in the cards for later this week.

S&P 500
E-mini S&P 500 Futures (ES), Daily Chart

For the remainder of the U.S. session, here are the key support levels to watch:

  • Support (1): 20 Day EMA, 2800.00
  • Support (2): Bollinger MP, 2787.00
  • Support (3): Daily SMA, 2762.50

Overview: It is highly unlikely that any of these numbers will come into play today. About the only scenario that may create a large sell-off in the S&P 500 is a surprise rate hike from the FED.

However, a tightening of the levels is a signal that this market is beginning to slow. If the opportunity presents itself, a long from the 20 Day EMA at 2800.00 is a solid way to join the long-term trend. With a stop below the Bollinger MP at 2786.75, this trade has over a 35 tick potential, implementing a modest R/R management plan.

ABOUT THE AUTHOR See More
Shain Vernier
US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

Related Articles

Comments

0 0 votes
Article Rating
Subscribe
Notify of
0 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments

HFM

Doo Prime

XM

Best Forex Brokers