S&P 500 tries to break out of major consolidation

The S&P 500 has pulled back a bit during trading on Wednesday, but has found the previous downtrend line to be a bit supportive, the top of the overall wedge that we have been in. This is the signal that I’d been waiting for, and now that we have seen this bullish pressure I think that the market is going to continue to find buyers. · FX Empire

Christopher Lewis

Updated Wed, May 9, 2018, 10:09 PM

The S&P 500 pulled back a bit during the session on Wednesday, but then found plenty of buyers at the previous downtrend line that has been a major factor in the overall consolidation wedge that we have been in. I believe that the market will continue to go to the upside due to a softening US dollar over the last several days, but also the strong corporate earnings that we have seen in America. After all, it’s the one economy in the world it seems to have reasonably decent economic numbers coming out, or at least they are essentially “less bad.”

I believe that the 2700 level above is resistance, but we should eventually break above there as well. If we can continue the overall pressure, I think it’s only a matter of time before we go to the 2800 level above. I anticipate that this will continue to be the case, looking at this market with a bullish anticipation and looking at pullbacks as an opportunity, not something to worry about. I believe that there will essentially be a bit of a “floor” at the 2650 handle, and ultimately the buyers will take advantage of any dip if we can stay above that level. It’s not going to be easy, but I think that this is a “buy on the dips” scenario this summer.