Earlier, we had a bearish structure on SP500. We took a loss and then SP500 continued moving up, changing the structure towards the bullish side. After this loss and the bullish structure, we will now wait for the support level to be tapped. The support level of 4050 has more tendency to mark up another bullish leg. But for now, we need to wait for the market to retrace back towards the support level.

The descending trendline has induced breakout buy earlier. The price action has been validated by opening and closing above the trendline and is now due a correction. This correction is what we need to cash on the rebound for a bullish impulse.

The golden retracement area of 75-78.6% is in confluence with the support level. This confluence formed has a strong foothold to keep the market from further falling down.

Both the EMA's are in a bullish sentiment but have a bearish death cross. The breakout buy from the EMA 50 has a possibility to retest the EMA back at the support level. Once its been retested, the continuation up towards the EMA 200 will be identified as our profit target.

Since, both the oscillators are at an exhaustion point, of over bought region on RSI and CCI, which is at 43 and 7, respectively. We need to see the oscillators neutralizing at the 50 and 0 range respectively. That being said, we will have other confluences with the technical factors at the support level which would act as a solid turn key point for the SP500.

Stack on SP500

Jun 05 2022

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