What’s inside:
- S&P 500 correcting in terms of time versus price
- Two trend-lines rising up from differing angles in focus as support
- Maintaining bullish stance
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The S&P 500 took another step on Friday towards consolidating the recent leg higher dating back to the 12/2 low. Our focus remains from the long-side with a little more backing-and-filling into support. The market may run into a confluence of support here shortly. We have our eyes on the intersection between the trendline running up off the November low and top-side trend-line extending back to the February double-bottom low. Intersection arrives at around 2245. However, if we see further sideways price action confluence may not be met given the angle of the November trend-line.
In the absence of sellers, the market is correcting more in terms of time rather than price. ('Time correction' is just another way of saying 'consolidation'. Consolidation into rising support versus an outright pullback is the more bullish scenario, and the increasingly likely one with each passing day. A push higher will initially put the S&P up against resistance at the 12/13 record highs of 2277.5. On a breakout to new highs, with nothing to the left, we could see the market trading to the whole figure of 2300 in the not-too-distant future.
As we said on Friday, it would require a sharp break through both lines of support before we would consider turning our attention towards lower levels. Unless that becomes an immediate threat, we will continue to stay in the bull camp as a time correction looks set to run into support prior to another leg higher.
S&P 500: Daily
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---Written by Paul Robinson, Market Analyst
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