Technical analysis – US 500 index slips after all-time high but holds within bullish area
May 23, 2024 5:26 pm
US 500 prints new record high thanks to Nvidia’s upbeat earnings
Better-than-expected US PMIs weigh on the market
Technical outlook positive above 5,280
The US 500 stock index has been moving from record high to record high over the past week, surging to a new high of 5,350 on Thursday following Nvidia’s upbeat Q1 earnings report.
Upbeat US business PMI figures, however, reminded investors that rate cuts could come with some delay, initiating a decline towards the tentative ascending line at 5,300, where the 50-period exponential moving average (EMA) is converging.
While the RSI is looking ready to cross below its 50 neutral mark and the stochastic oscillator is preparing for its next bearish cycle, the bears may not take control unless the price drops below the previous peak of 5,280. Such a correction would worsen the outlook, squeezing the price towards the 100-period EMA at 5,250 or lower within the 5,190-5,200 region, where the 200-period EMA is located.
A bounce back above the 20-period EMA at 5,323, which canceled bearish actions a couple of times previously, could reduce the negative risks, helping the price to climb into the 5,365-5,400 trendline region. Above the latter, the 5,433 territory could cause some consolidation. If the bulls surpass that barrier, the uptrend could stretch towards the 161.8% Fibonacci extension of the previous downleg at 5,500.
In brief, the US 500 stock experienced a swift decline after charting a new all-time high, but it has yet to violate the bullish area below 5,280.
US 500 prints new record high thanks to Nvidia’s upbeat earnings
Better-than-expected US PMIs weigh on the market
Technical outlook positive above 5,280
The US 500 stock index has been moving from record high to record high over the past week, surging to a new high of 5,350 on Thursday following Nvidia’s upbeat Q1 earnings report.
Upbeat US business PMI figures, however, reminded investors that rate cuts could come with some delay, initiating a decline towards the tentative ascending line at 5,300, where the 50-period exponential moving average (EMA) is converging.
While the RSI is looking ready to cross below its 50 neutral mark and the stochastic oscillator is preparing for its next bearish cycle, the bears may not take control unless the price drops below the previous peak of 5,280. Such a correction would worsen the outlook, squeezing the price towards the 100-period EMA at 5,250 or lower within the 5,190-5,200 region, where the 200-period EMA is located.
A bounce back above the 20-period EMA at 5,323, which canceled bearish actions a couple of times previously, could reduce the negative risks, helping the price to climb into the 5,365-5,400 trendline region. Above the latter, the 5,433 territory could cause some consolidation. If the bulls surpass that barrier, the uptrend could stretch towards the 161.8% Fibonacci extension of the previous downleg at 5,500.
In brief, the US 500 stock experienced a swift decline after charting a new all-time high, but it has yet to violate the bullish area below 5,280.
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