CFD Update: SPX500 remains in a battle
Looking at the SPX500 today, price looks to be setting up for a battle between resistance and support. Fundamental influences lean to the further downside but has the market started to price in the continued inflationary shock ?
Yesterday’s price took a swing to the downside, cancelling out the previous day’s rally after yields once again hit uncomfortable levels and CPI hit fresh highs. Inflation is nothing new in the U.S. but the recent increases to unexpected levels is hitting the market and causing concerns about the potential amount of rate rises possible from the FED.
The SPX500 index looked to be forming a nice counter-rally after January’s lows but that stalled yesterday as sellers hit back. Studying further we can see that price has broken the long term trend and has set up solid resistance at 4,589. Below we can also see that buyers are mounting a challenge from 4,483 and this sits in a demand area with lots of buyer rejection. These are our battle lines, a rally above resistance suggests that buyers have more left in the current counter-rally, but a break below support and demand starts to suggest a new continuation lower could be on the cards and the last lower high could be confirmed.
If sharp selling did resume we would be looking below at LT support for buyer resistance. If buyers can break resistance 4,660 to 4726 could offer resistance. We see tonight’s session as an interesting close to see where the market will finish off the week. With little news, we could also end up with a stalemate with price remaining between the two points.
SPX500 D1 Chart 
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