US 500 Index Hovers Between Short-term SMAs

Technical analysis of Forex market

The US 500 index (Cash) is trading below the record high of 3,963.58, flirting with the 20- and 50-day simple moving averages (SMAs). The momentum indicators are suggesting a downside reversal as the MACD is losing ground below its trigger line and the RSI is turning lower around the neutral threshold of 50.

Further losses could take the index towards the 3,664 support ahead of the 3,595 barrier, which stands around the long-term ascending trend line. A break below this line could shift the bias to a neutral one, hitting the 200-day SMA at 3,489. Slightly below this level, the 3,460 support could come in focus.

Alternatively, an upside movement could find immediate resistance at the 20-day SMA currently at 3,883, which is acting as strong resistance before moving towards the all-time high of 3.963.58. Overcoming this obstacle, the price could enter uncharted levels such as 4,000 and 4,500.

Briefly, the index is completing a somewhat bearish retracement in the near-term, however, the broader outlook is still strongly positive.