S&P500 – sell now
Friday again and the main macro news today is US December CPI data which will set the course for today’s US trading session. In my last Friday SP500 review I recommended to initiate long positions based on assumption that NFP reading expected to be fantastic, market is still oversold and Fed is becoming more dovish. Well, the trade was good and now, a week later it is likely that it is time to close longs.
Today’s Asian session was positive following previous night US session as US-China trade talks are set to continue.
However, based on my technical view, I believe this rally is about to fade away.
Price is sitting at 2591 – and this is exactly the level that served as a strong support during October-December sell-off – double test before broken below. Now it is (in theory !) should become a strong resistance level. Besides, it is serious cluster of lines and I would bet on selling now. Next strong resistance area is at 2640 and I will scale into my short position should the price has another impulse up. But I believe this rally is fading away.
This expected move down is likely to be contained at 2530 and 2500 supports – close your shorts and enter longs again at those levels.
Have a nice weekend and safe trades !