The S&P 500 has been rising steadily since last week due to a more dovish than expected FOMC decision where the Fed decided to signal a bigger QT taper beginning in June and the Fed Chair Powell pushing back repeatedly against rate hike expectations. Moreover, the data on Friday showed that the Fed might indeed just keep rates higher for longer as job and wage growth soften. All of the above is supportive for the market in the short term as the hawkish positioning unwinds a bit.
S&P 500 E-mini Futures Technical Analysis – Daily Timeframe
On the daily chart, we can see that the bigger correction into the 4834 level might have been invalidated for the time being. The S&P 500 bounced around the 5000 level as we got two positive catalysts from the FOMC decision and the softer US NFP data. The path of least resistance remains to the upside with new all-time highs in sight.
S&P 500 E-mini Futures Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that the price broke out to the upside following the softer US NFP report and after a retest of the 5120 zone, continued higher with the buyers piling in with more conviction. If we get a pullback, the 5167 level might be the first support for a dip-buying opportunity.
Upcoming Catalysts
This week is pretty bare on the data front with just the US Jobless Claims on Thursday and the University of Michigan Consumer Sentiment survey on Friday being the only notable releases. It’s unlikely that they will change the market’s expectations that much, so the price action might remain tentative heading into the US CPI next week, although the bias should remain bullish.
