Fundamental Overview
The S&P 500 continues to maintain a positive outlook although it came under some pressure recently as the DeepSeek news weighed on overvalued AI stocks.
The market has been making new highs ever since the last US inflation data as it marked the top in the repricing of rate cuts expectations and inflation fears.
The Fed on Wednesday kept interest rates unchanged as widely expected and Fed Chair Powell maintained a neutral stance as they are waiting for more inflation progress and more clarity on Trump’s policies before cutting again.
The market is now back in expecting two rate cuts by the end of the year with the first one seen in June. The risks ahead lie around inflation as the market will want to see more progress to avoid some tightening in financial conditions.
There are also risks to growth, especially if Trump’s tariffs lead to trade wars. Right now, it seems like he just threatens countries with tariffs to get better deals, so the market generally fades the news.
S&P 500 Technical Analysis – Daily Timeframe
On the daily chart, we can see that the S&P 500 erased almost all the gains from the benign US inflation data as the DeepSeek news weighed on tech stocks. The dip-buyers didn’t wait for long, and we are now nearing the all-time highs again.
The buyers will want to see the price breaking higher to increase the bullish bets into new highs, while the sellers will likely step in with a defined risk above the all-time high to position for a drop back into the 5855 level next.
S&P 500 Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that we broke above the recent high at 6112 with the buyers piling in with a defined risk below the level to extend the rally into the all-time high. The sellers, on the other hand, will want to see the price falling back below the 6112 level to position for a drop into the 6042 level next.
S&P 500 Technical Analysis – 1 hour Timeframe
On the 1 hour chart, there’s not much we can add here as the buyers will likely pile in around these levels to push into a new all-time high, while the sellers will look for a drop below the 6112 level to target a pullback into the trendline. The red lines define the average daily range for today.
Upcoming Catalysts
Today we conclude the week with the US PCE and the US Employment Cost Index.
This article was written by Giuseppe Dellamotta at www.forexlive.com. Read More Details
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