Equity markets have seen a few positive days lately and the SP500 index has risen 6 per cent from last week’s lows. On Friday, it was trading 1 per cent higher during the London session and it was trying to jump above the 2,765 USD level, where the 200-day moving average is located.
The index staged an impressive rally, mainly due to heavily oversold conditions. However, if the price remains below the mentioned 200DMA, the long-term trend could still be bearish. Therefore, the battle for the 2,765 USD level may be the key event.
If the price jumps back beyond, the trend may switch to bullish again, with the next target at 2,795 USD and the next level at the 100-day moving average near 2,820 USD.
On the downside, support is located currently near 2,740 USD and while above, the intraday outlook seems to look bullish. The next buying zone could be near 2,720 USD.
The end of year is a seasonally strong session for stocks every year, also known as the Santa Claus rally and therefore, if the index jumps above the 200DMA, we could see another strong rally this year.
Disclaimer:
Analysis and opinions provided herein are intended solely for informational and educational purposes and don't represent a recommendation or an investment advice by TeleTrade. Indiscriminate reliance on illustrative or informational materials may lead to losses.