The S&P 500 under a microscope. Is the bleeding over or a buyer’s trap?

The most important events on the economic agenda today (United States of America):

• Change in Private Sector Employment (ADP): Actual: 62K | Projected: 41K | Previous post: 66K.
• Core retail sales (month-on-month): Actual: 0.5% | Expected: 0.3% | Previous post: 0.0%.
• Retail Sales (MoM): Actual: 0.6% | Expected: 0.5% | Previous: -0.1%.
• Manufacturing Purchasing Managers Index (ISM): Actual: 52.7 | Expected: 52.3 | Previous post: 52.4.

Technical vision and expected scenarios:
Looking at the daily chart, the index is currently trying to regain upward momentum after rebounding from around 6,300 points, with prices currently trading around 6,600 points, testing the 20-day moving average, which forms the current resistance area.

We also note that the Relative Strength Index (RSI) is rebounding from “oversold” territory and rising to levels around 47, indicating improved buyer appetite in the short term. However, the index is still below the 50 level, so caution is needed; this rebound may only be a temporary corrective rise, and confirmation of this will depend on whether the price can break through the major resistance levels.

Based on this, here are the possible scenarios:

1. Positive Scenario:
Stability above 6,542, as well as a breakout and stabilization above the moving averages (20-day and 50-day), could open the door to retargeting levels around 7,000, the previous all-time peak.

2. Scenario:
Price’s inability to break above current resistance while remaining above 6,542 may lead to occasional chop and chop pending a clearer economic outlook on the horizon.

3. Negative Scenario:
Another decline and holding below 6,542 may indicate that the supply side is regaining control, and the supply side may fall again, with targets at 6,214 and perhaps 5,921.
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