18, October 2016

S&P500 (a 4-hour chart)

General overview

Wall Street opened lower as expectations over the Fed's next monetary policy action remained a key determinant for the stocks. Investors prepared for a week full with corporate earnings reports.

Current situation

The index started the week with a recovery. S&P500 moved higher towards 2130 and was able to erase some of its losses during the Asian and European sessions on Monday. Buyers failed to retake the level and S&P500 sharply decreased at the beginning of the New York session. Prices broke upwards the 50-EMA and shortly pierced the 100-EMA in the 1 hour chart. The index failed to hold its gains and decreased back below the moving averages in the mentioned timeframe. The moving averages (50, 100 and 200) maintained their bearish slope. The resistance is seen at 2130, the support is at 2120.

MACD remained at the same level which indicates the sellers’ strength. The RSI remained within negative levels.

Trading recommendations

The price traded in a descending channel, staying close to its upper limit. A move above the range will weaken sellers’ positions. An uptrend will start as soon, as the S&P500 rises above the resistance level 2140. The index will extend its losses towards 2110 after breaking the support 2120.