20, October 2016

S&P500 (a 4-hour chart)

General overview

American stocks opened higher on Wednesday on the back of the strong quarterly earnings.

Current situation

The index was positive yesterday despite the negative spike in early European trades. Sellers failed to retake the level 2130, the price bounced from the support and jumped to the 2135 region. The growing momentum was stopped by the 50-EMA which rejected the price downwards. The moving averages (50, 100 and 200) maintained their bearish slope. The resistance is seen at 2140, the support is at 2130.

MACD indicator is at the centerline. If the histogram enters the positive territory, that will indicate buyers’ growing strength. If MACD returns into the negative area the sellers will take control over the market. RSI was neutral during the day.

Trading recommendations

The bearish tone persists. The S&P500 index may try to retake the level 2130 after a current roll back.  The next level to focus on is 2120.