Last week, the S&P 500 didn't move much given the lack of economic events and the Thanksgiving holidays in the final part of the week. The only two important reports were the US Jobless Claims and the US PMIs. The former beat expectations across the board, while the latter came basically in line with forecasts. This week we can expect more action with the holidays in the rear-view mirror and some key economic releases on the agenda.
S&P 500 Technical Analysis – Daily Timeframe
On the daily chart, we can see that the S&P 500 has almost reached the cycle high at 4607 following an incredible rally for the entire month of November. We can expect the sellers to step in around these levels targeting at least a deeper pullback. The buyers, on the other hand, remain in control and it’s hard to see them folding without a catalyst.
S&P 500 Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price is diverging with the MACD, which is generally a sign of weakening momentum often followed by pullbacks or reversals. This might be a signal that we could see a pullback very soon, so it might be a good idea for the buyers to take some off the table, especially at these key levels.
S&P 500 Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the divergence with the MACD, which has been going on since the breakout of the key trendline around the 4400 resistance. The buyers continue to lean on the lower bound of the rising channel and the red 21 moving average to target the cycle high. The sellers, on the other hand, will want to see the price breaking lower to target a drop into the 4490 level and upon a further break, the support around the 4400 level where we can also find the 38.2% Fibonacci retracement level of the entire rally.
Upcoming Events
Tomorrow, we have the US Consumer Confidence report. On Thursday, we will see the latest US Jobless Claims figures and the US PCE report. On Friday, we conclude the week with the US ISM Manufacturing PMI which missed expectations by a big margin the last time.