S&P 500: Trend & Pattern Point to New Highs Soon
- S&P 500 ‘time correction’ close to ending
- Triangle pattern on hourly
- New record highs look to be likely very soon
In yesterday’s post, it was noted that the current ‘time correction’ was set to run into trend-lines running up from the November low and potentially the one off the February low. It looked as though a possible touch of these lines could come simultaneously (confluence), but it is becoming increasingly likely the current consolidation will first find support at the November trend-line.
Looking closer at the hourly chart, the November trend-line lies a short distance below around the 2253/55 vicinity. Ideally, we see a touch of support then strong reaction higher. This would further fill out a symmetrical triangle developing over the past week. The apex of the pattern and rising trend-line are set to intersect no later than tomorrow, so we may not see a full test of the Nov trend-line.
With that in mind, a top-side break of the triangle should set into motion another thrust higher to new record highs above 2277.5. Negating this short-term outlook would be a downward break, which is certainly possible with this type of pattern, but looking unlikely with trend and generally strong risk appetite supportive of higher prices.
In terms of significant U.S. data, the docket is light this week. On Thursday, at 13:30 we will get a look at Durable Goods Orders for November, the only ‘high’ impact data scheduled. For all scheduled data events, check out the economic calendar.
S&P 500: Hourly (Daily)
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---Written by Paul Robinson, Market Analyst
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