In the American session, the SP 500 #SPX index is trading below 7/8 of murray that is an area of strong resistance suggesting a probability of reversal. The SMA is located just below this level. If it breaks it, the index could make a drop to the 6/8 Murray support zone.
Investors have accepted the idea of a strong economic recovery from the pandemic, practically confirmed by high inflation readings, which has added optimism to the SP 500 Index that is surpassing its all-time high.
On the other hand, the Federal Reserve has made it quite clear that it is waiting to see more progress in the US labor market before beginning to curb its massive bond buying program, or even consider raising interest rates.
Stock markets are pointing to a slightly lower open on Wednesday, as it is the end of a quarter and some price corrections could occur as part of taking profit and also because of the end of the month.
The chart clearly shows the last candles that a consolidation is taking place at the 7/8 murray level. It means that there could be a correction movement only if the SP500 consolidates below 4,280.
Our recommendation is to sell below 4,296 (7/8 of murray) or a consolidation below the 21 SMA to sell with targets at 4,218 there is the 200 EMA.
The technical reading of the eagle indicator is showing a clearly bearish signal. Bearing in mind the prospects of the price consolidation, we must sell only if the #SPX is trading below 4,300 points.
Support and Resistance Levels for June 30, 2021
Resistance (3) 4,322
Resistance (2) 4,311
Resistance (1) 4,292
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Support (1) 4,262
Support (2) 4,253
Support (3) 4,224
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