The main U.S. stock market indexes gained 1.1-1.6% yesterday as investors reacted to the Fed Chairman’s comments about the need for further monetary easing. The S&P500 index was the highest since May 22 and closed at its record high (1,675.02). The technology stocks index Nasdaq Composite gained 1.6%, reaching its new all-time high. Aside from the reaction to the Fed announcements, the market bets that the quarterly earnings releases will be better than expected. The S&P500 index got closer to the above-mentioned May 22 all-time high, so the nearest level of resistance is at around 1,687.18. The breakout above the May-June downward trend line is positive, but a few month long consolidation scenario still cannot be excluded as the index daily chart shows:

Investors expect a rather neutral opening of trade today, as there is a growing fear of a correction of the recent uptrend. In the short term the S&P500 futures contract (CFD) fluctuates in a rather tight range, after the Wednesday’s after-hours quick move up. The nearest resistance seems to be at 1,670 and the support zone is at 1,640-1,650, marked by the previous consolidation’s upper boundary. The S&P500 futures contract is still above its short-term upward trend lines, as we can see on the 15-minute chart:

Thank you,
Paul Rejczak