Stocks stay vulnerable with spotlight on Chairman Powell

  • Global equity markets remain nervous after the very strong US Employment reports on Friday.
  • The worry is that the Federal Reserve (Fed) will shift away from a perceived more dovish tone, given the strong data and the resumption of the US-Sino trade talks
  • Furthermore, Fed Chairman Jerome Powell is testifying in front of Congress today and Thursday, as we highlighted here in the FX Explained MacroWatch, which should reinforce the concerns in the market and leaves the major US (and global) equity averages at risk to the downside in the short-term.
  • Here we spotlight the US broad, benchmark average, the S&P 500.

S&P 500 E-Mini bias still lower, despite bounce

A Tuesday selloff and rebound from above the small bull gap at 2955.5-55.25 (off of 2963.5), but sustaining negative pressures whilst below 2988.75 from the Monday selloff below Friday’s spike low at 2971.25, to reinforce Friday’s notable selloff (after the US Employment report) to probe the notable 2973.75 support level, switching the bias to the downside Wednesday.

The latter June surge above 2943.25 set an intermediate-term bull trend.

For Today:

  • We see a downside bias for 2963.5; break here quickly aims for the small bull gap at 2955.5-55.25, maybe 2946.5 and even 2935.0.
  • But above 2988.75 opens risk up to 2997/98, maybe the record high at 3006.0.

Intermediate-term Outlook – Upside Risks: We see an upside risk for 3033.75 and 3060.0.

  • What Changes This? Below 2871.5 shifts the intermediate-term outlook back to neutral; through 2808.0 is needed for an intermediate-term bear theme.

Resistance and Support:

2988.75 2997/98 3006.0 3011.5 3025.0
2963.5 2955.5-.25* 2946.5 2935.0* 2914.5***

4 Hour S&P 500 E-Mini Future Chart

Comments on this analysis

Your email address will not be published. Required fields are marked *

Latest News

The Forex Zone
The Forex Zone – Risk On

The US Dollar and the Japanese Yen weaken as the risk on environment continues. The Forex Zone looks at day trade themes for the major Forex rates; EURUSD, GBPUSD, USDCAD, AUDUSD, NZDUSD and USDJPY. EURUSD: Risks flip back higher A very whipsaw session Thursday through the ECB with an initial selloff through to just hold … Continued

Euro in focus into key European Central Bank (ECB) Meeting

All eyes will be on the European Central Bank (ECB) Meeting today, which much anticipation around a more dovish shift. US Dollar weakness has seen EURUSD rebound in September with a resumption of a global “risk on” theme, but the EURUSD Forex rate losses over the past 24 hours highlight caution into the meeting. EURUSD: … Continued

aud usd chart
Australian Dollar stays strong in risk on scenario (AUDUSD)

The “risk on” phase has contoured into the second week of September as global geopolitical tensions ease. Positive news in early September regarding Brexit, the US/China trade war and from Hong Kong have seen stock markets advance higher. This positive news for the global economy has encouraged a push higher for the Australian Dollar, which … Continued

Euro firm ahead of the ECB (as US Dollar weakens)

EURUSD gains over the past week have primary echoed US Dollar losses, as global financial markets have shifted to a “risk on” mode, with global geopolitical tensions easing. Positive news last week around the US-Sino trade war, Brexit and from Hing Kong have seen stock averages rally, whilst the US Dollar has weakened, having been … Continued

Forex Brokers in your location