Subscribe to RSS

S&P 500: Could US stocks hit fresh highs in early 2016?

It is the last full trading day of 2015 as the major global stock exchanges will either be shut tomorrow or close early due to the New Year’s Eve and will remain closed on the New Year’s Day. Normal trading will resume from Monday January 4. Understandably, the economic calendar is very quiet, although later on in the day we will have the latest US pending home sales and crude oil inventories data, which could offer some volatility. Tomorrow’s key US data will include the weekly unemployment claims and Chicago PMI. Clearly, there is not much fresh fundamental stimulus to provide direction for the equity markets, except perhaps the potential volatility in energy stocks should oil prices move sharply on the back of the US crude inventories data. Consequently, we are concentrating on the technical analysis side of things today.

Below, we are looking at the daily chart of the S&P 500. Though technically speaking, the index is still in consolidation, a closer inspection reveals some bullish indications. For a start, the bears have now had at least three failed attempts at trying to break the key support around 1995-2008 (shaded in light blue), an area which was formerly resistance. Relative to the last sell-off that occurred at the end of the summer, these latest futile attempts to move lower have also been shallow, with the index repeatedly finding good support around the 38.2% Fibonacci retracement level (~2008) of the up move from the August low. The shallow retracements suggest the bulls have more control.

Added to this, some of the lagging indicators are also now turning bullish. The 50-day moving average (2068) has already moved above the 200 MA (2060) again to create a so-called “golden crossover,” while the momentum indicator MACD has just formed its own “bullish crossover.” The golden cross is an important development for some momentum traders. This group of market participants typically only buy when an asset’s moving averages are in this order (of course, only when their other entry criteria are also met). The last time the S&P’s golden cross occurred was in early 2012, which saw the index climb steadily for the next few years until a “death cross” (i.e. 200 SMA < 50 SMA) was formed this August. Although we always warn that historical data is not a good indicator of future performance, the markets do tend to move higher when a golden cross happens. In the case of the S&P, this crossover had occurred some 22 times since 1970, according to Dow Jones. Of those occurrences, the index traded higher 19 times a year later. This would thus be the 23rd crossover since 1970. Will we see higher stock prices in 2016?

But the S&P has struggled to move higher from around these current levels so many times in 2015, so the bulls will now need to chop some wood if we are to see fresh all-time highs soon. The immediate resistance levels to watch are at 2080, followed by a bearish trend line around 2100/10. The previous peak was formed around 2137 in May. On the downside, the above-mentioned moving averages could provide some support upon re-test. Failure to do so, could see the index head towards the next potential support at 2045 and if this level breaks down then a revisit of the key support area between 1995 and 2008 could be a possibility in early 2016.

S&P 500

0 commentsback to post

Add your comment

Nickname:
E-mail:
Website:
Comment:

Other articlesgo to homepage

Get 20% Bonus Make $100 Deposit or More – FirewoodFX

Get 20% Bonus Make $100 Deposit or More – FirewoodFX(0)

20% Forex Bonus Make $100 Deposit or More. Bonus can be used as additional margin and equity If you deposit $500, you can hold a losing position up to $600 Link: 20% Bonus Make $100 Deposit or More Available to: All new and existing Bonus Ending Date: 31 December 2017 Bonus offer: 20% Bonus Make

150% Bonus for a First Time to Binary Trading – NordFX

150% Bonus for a First Time to Binary Trading – NordFX(0)

Up to 150% Bonus for a First Time to binary options Account. For a perfect start, we offer you a 150% bonus for a first-time $5,000 deposit. Link:  Up to 150% Bonus for a First Time Link:  100% Withdrawable Deposit Bonus Link:  55% Deposit Bonus Promotion Available to: All new traders Ending Date: 31 December

100% Welcome Bonus Plus Daily Free Signals – Trade12

100% Welcome Bonus Plus Daily Free Signals – Trade12(0)

Get 100% Welcome Deposit Bonus and 7-day risk free trade, Boost your trading with a free 100% Welcome Deposit Bonus to your Live Trading Account. Link:   Get 100% Welcome Bonus Link:  50% Exclusive Deposit Bonus Link:  Free Daily Forex Trading Signals Available to: All new clients Ending Date: 31 December 2017 Bonus Offer: Get

25 Euro Forex No Deposit Welcome Bonus – direktbroker-FX

25 Euro Forex No Deposit Welcome Bonus – direktbroker-FX(0)

25 Euro Forex No Deposit Welcome Bonus to all EU and the UK  live Trading Account Holder. Open a real account direct instead of an demo account first and you will get a 25,- Euro Free. Link:  25 Euro Free Welcome Bonus Available to: All new account Ending Date: 31 December 2017 Bonus offer: 25

Up to $250 Cash in Your Expert Advisor – ThinkMarkets

Up to $250 Cash in Your Expert Advisor – ThinkMarkets(0)

Up to $250 Cash in Your Expert Advisor. Make the Move to Think Trader and Cash in Your Expert Advisor for Up to $250* Link:  Up to $250 in Your Expert Advisor Available to: All new account Ending Date: 31 December 2017 Bonus offer: Up to $250 Cash in Your Expert Advisor Bonus to all new

$30 Forex No Deposit Bonus Welcome Promo – XM

$30 Forex No Deposit Bonus Welcome Promo – XM(0)

$30 Forex  No Deposit Bonus Welcome Promo Bonus and 15% Welcome Deposit Bonus, Welcome Bonus brings Real Account clients the best rewards available. Entering the markets and trading with XM enables you to earn from your trades and build your own bonus up to a maximum of $1,000. Link:  $30 Forex No Deposit Bonus Link: 

50% Re-Deposit & 100% Tradable Bonus – Xtream Forex

50% Re-Deposit & 100% Tradable Bonus – Xtream Forex(0)

50% Re-Deposit Tradable Forex Bonus for all of its traders. Every existing and new trader is eligible for this Re-Deposit Tradable Bonus for depositing into their trading account. Link:  100% Tradable Deposit Bonus Link:  35% Deposit Cash Bonus Link:  50% Re-Deposit Forex Bonus 50% Re-Deposit Forex Bonus XtreamForex is glad to announce 50% re-deposit forex

Free $50 No Deposit Bonus and Start Trading – Trade360

Free $50 No Deposit Bonus and Start Trading – Trade360(0)

$50 Forex No Deposit Bonus is available only once for each client. Every verified user can use $50 No Deposit Bonus and get one or several investment accounts. Link:  $50 Forex No Deposit Required Bonus Link:  $280 CashBack Rewards Program Available to: All new account Ending Date: 31 December 2017 Bonus offer: $50 New No

200% Cashback Rebate Bonus up to $10000 – ForexTime

200% Cashback Rebate Bonus up to $10000 – ForexTime(0)

200% Forex Cash back Rebate Bonus up to $10,000, whether they’re first time depositors or returning clients. and get $4 Cashback back for every lot you trade. Link:  Loyalty Cashback Promotions Link:  200% Cashback Rebate up to $10000 Ending Date: 31 December 2017 Available to: All Customers Bonus Offer: ForexTime Rewards Loyalty in Withdrawable Cashback

$50 Free No Deposit Credit Bonus Promotion – GDMFX

$50 Free No Deposit Credit Bonus Promotion – GDMFX(0)

$50 No Deposit Credit Bonus Promotion 2017 to all new account. The $50 no-deposit bonuses is available for clients who open their first registration with GDMFX Link: $50 No Deposit Credit Bonus Promotion Available to: All new account Ending Date: 31 December 2017 Bonus offer: $50 No Deposit Credit Bonus Promotion 2017 to all new account.

read more

Forex Featured Broker

Contacts and information

ForexDepositNews.com Forex Deposit Bonus, Forex No Deposit Bonus, Forex Live Contest, Forex Demo Contest, Free Forex Bonus Forex Brokers Review and Other All Forex promotions.

ForexDepositNews.com

Social networks

Most popular categories