SPX closes above its opening price after recovering from early selling pressure
S&P 500 Index (SPX) Technical Analysis Report for Dec 06, 2018 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, SPX ended Thursday at 2695.95 edging lower $4.11 (-0.15%) ahead of tomorrow's NFP report. Trading up to $41.98 lower after the open, the index managed to reverse during the session as bulls took control ending the day above its opening price.
Daily Candlestick Chart (SPX as at Dec 06, 2018):
Thursday's trading range has been $74.42 (2.79%), that's far above the last trading month's daily average range of $41.57. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for SPX.
One bullish candlestick pattern matches today's price action, the Bullish Closing Marubozu.
After trading down to 2621.53 earlier during the day, the market bounced off the key technical support level at 2651.89 (S1). The failure to close below the support might increase that levels importance as support going forward. When prices bounced off a significant support level the last time on November 23rd, SPX gained 1.55% on the following trading day. Prices are trading close to the key technical resistance level at 2706.85 (R1).
Though the S&P is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for S&P 500. Out of 358 times, SPX closed higher 60.61% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 67.32% with an average market move of 0.74%.
With five out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are DAX losing -3.48% and FTSE closing -3.15% lower. On the flipside the best performer has been NDX closing 0.64% higher. Read more