Global stock averages basing, led by the S&P 500

Intermediate
  • The trade war is still dominating the global financial market landscape, with various statements and rumours from both the USA and China throughout August, leading to erratic and volatile price action for global asset classes, with equity indices signalling intermediate-term vulnerability earlier this month.
  • BUT there have been positives, with the US and China indicating trade talks would resume in coming weeks, whilst the US delayed the latest set of tariffs on China until December.
  • In addition, US data continues to prove solid (US CPI and Retail Sales beating forecasts last week), and from a technical perspective, the S&P 500 the US benchmark average, is attempting to secure a base.

S&P 500 E-Mini upside risks to key 2944.25 and 2961.0 targets

A very firm advance Monday through the 2906.25 barrier and the down trend line from early August then to probe an important impulse resistance at 2929.75, to build on Friday’s solid rally (above 2871.75 resistance), not just rejecting short-term bear forces, but fully resuming basing pressures and upside forces, setting the bias back higher for Tuesday.

We see an intermediate-term bear trend, BUT with risks for a shift back to neutral above 2944.25 and even to bullish above 2961.0.

For Today:

  • We see an upside bias for 2932.25; break here aims for key 2944.25 and maybe critical 2961.0.
  • But below 2911.0 aims for 2893.0 and then maybe opens risk down to 2875.5.

Intermediate-term Outlook – Downside Risks: We see a downside risk for 2732.25/31.75.

  • Lower targets would be 2637.0 and 2579.75.
  • What Changes This? Above 2944.25 shifts the intermediate-term outlook back to neutral; then quickly above 2961.0 is needed for an intermediate-term bull theme.

4 Hour S&P 500 E-Mini Future Chart

SP500

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