- Global financial markets have seen riskier assets plunge and safe havens rally in very volatile activity overnight Tuesday-Wednesday amid an escalation in the tensions in the Middle East.
- Iran have attempted to strike at US targets in Iraq to intensify the negative, “risk off” theme that started 2020 after the US airstrikes in the Middle East last week.
- Global stock indices have plunged lower and despite the subsequent rebounds, markets remain technically damaged and very vulnerable.
- Here we focus on the future on the US broad benchmark index, the S&P 500.
S&P 500 day trade outlook: Still a negative tone and bearish threats
A Tuesday failure from within our flagged 3253.5/55.0 resistance area (from 3254.5) to the push below 3235.75 support (to 3231.75, but then a plunge overnight through 3208.75/06.75 and 3194/92 supports and despite an overnight rebound too, retaining a negative bias from last Friday’s plunge after an overnight setback last Thursday, to keep risks lower into Wednesday.
- We see a downside bias for 3221.75; a break below aims for 3211/10 and 3194/93, maybe 3181/77.
- But above 3243/45 aims for the 3254.5/55.0 area and opens risk up towards the cycle high at 3263.5 and 3267.75.
A December surge through the key 3158.0 peak signalled an intermediate-term bullish shift.
Upside risks: We see an upside risk for 3337.75
What changes this? Below 3159.75 shifts the intermediate-term outlook to neutral and below 3069.5 to an intermediate-term bear theme.
4 Hour S&P 500 E-Mini Futures Chart