S&P 500: Trump Takes White House, Futures Hit Limit Down
- Trump victory sparks massive market volatility
- Market environment geared towards the very short-term minded traders
- Support and resistance outlined
It’s finally over. Or just beginning, depending on how you want to view it. But the highly anticipated US presidential election was decided in an unexpected manner – Donald Trump took the White House. Markets were not pricing in a Trump victory and the massive volatility which came as a result is a testament to that.
The S&P 500 futures at one point were limit down, off by over 100 handles at their worst. Since then they have surged back to only down about 31 points at this time. We are setting up for a very volatile trading day…and rest of the week.
This isn’t a swing-trader’s market, but rather for those nimble day-traders looking for intra-day scalps to maybe an overnight as the longest hold. At least until things settle and a trend emerges.
We will likely open the cash session back below the 2115/20 level which was so important prior to the surge into the election on news the FBI cleared Trump’s opponent, Hillary Clinton. We will view this once again as the first hurdle for the market to overcome.
On the downside, we are poised to potentially test the April lower parallel and parallel belonging to the top-side 8/23 trend-line. These two lines intersect around the 2090 mark. Not far below at 2085ish is the 200-day MA, touched on Friday (low was 2084), will come into play. Should we press down on those levels soon (possibly today), we will first look to see if the market can hold and bounce. A close below key support opens the door up for a larger move down, with no visible price support until the post-Brexit lows at 1991.
S&P 500: Daily
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---Written by Paul Robinson, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.