Chart Of The Day: SPX
Blake Morrow | May 26, 2022 06:57PM ET
We have heard from some FOMC members recently, which leads us to believe that their rhetoric may be changing near term to a less hawkish stance as U.S. data continues to come in weaker than expectations.
This has led to a rally on the S&P 500, from below the 3900 level and could also lead to a test of the 4100. With the "end of month" flows squarely in the sights of the market, stocks could gain some steam higher if the 4100 (neckline of the head-and-shoulder pattern and previous support) is broken. Since the volume has been light in this rally, the risk is a rally attempt from here will probably fail. The question is "4100? 4200? Higher?" The 4129 level is the 38% Fibonacci retracement, and somewhere near the 50-day moving average, or between the 50% and 61.8% retracement seems like a likely upside target before selling resumes.
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