US stock markets have been on the rise lately, but are we finally seeing signs of a correction to the rally in the S&P 500?
Check out these nearby turning points!
S&P 500 Index (SP500) 4 Hours Chart by TradingView
Optimism for business-friendly policies under another Trump administration has allowed US stock indexes to rise, pushing the S&P 500 past the $5,900 ceiling to new record highs above the $6,000 mark.
This psychological mark appears to be holding as strong resistance, paving the way for profit taking to trigger a correction to nearby support areas.
Are stock market bulls about to make a comeback soon?
Remember that directional biases and volatility conditions in market prices are usually driven by fundamentals. If you haven’t done your homework on the US stock market yet, it’s time to check the economic calendar and stay up to date with daily fundamental news!
The Fibonacci retracement tool shows that the previous resistance area spans the 50% to 61.8% levels and the uptrend line that has been holding since mid-October, as well as dynamic support at the moving averages.
A shallow pullback could find buyers at the 38.2% Fibonacci level that is in line with the pivot point level ($5,904.23), which could take the indicator back to the swing high and beyond.
The 100 SMA is still above the 200 SMA suggesting that the uptrend is more likely to resume rather than reverse, but watch for a move below S1 ($5,793.32) and the trend line which could mark the beginning of a downtrend.
As always, stay on your toes for major headlines that may impact overall market sentiment and practice appropriate position sizing when making any trades!
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