S&P500: Near the top of the Bear Market Resistance

The S&P500 is under high volatility at the moment after the CPI report matched the forecast (6.5%). The index is trading inside a Channel Up, above both the 4H MA200 and 4H MA50, with the two close to forming a Golden Cross. With most 4H technicals overbought (RSI = 70.997, MACD = 30.350, ADX = 39.740) and the price approaching the Lower Highs Resistance that is in place for a whole year (only had the fake-out break on December 13th), the index is increasing turning into a sell opportunity.

Below the Channel Up and the 4H MA200, it is a short-term short to Fibonacci 0.618 (3,870). Validated/ confirmed buying at this point is only above the 1W MA50. From a fundamental perspective, it is the continuous drop on the US10Y, that is favoring capital going to riskier assets like stock. Keep an eye for a possible low there and reversal, for validation of the sell thesis on S&P500. But if bond yields continue to fall, the equity rally will be extended and a weekly close above the 1W MA50 should set S&P500 back into the new Bull Cycle.




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