SPX finds buyers again around 2933.59
S&P 500 Index (SPX) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
SPX ended the week 3.2% higher at 2955.45 after edging higher $6.94 (0.24%) today ahead of tomorrow's Memorial Day market holiday. Trading up to $14.46 lower after the open, the index managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (SPX as at May 22, 2020):
Friday's trading range has been $23.17 (0.79%), that's far below the last trading month's daily average range of $46.07. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for SPX. Prices continued to consolidate within a tight trading range between 2913.86 and 2980.29 where it has been caught now for the whole last trading week.
After having been unable to move lower than 2938.57 in the previous session, the stock index found buyers again around the same price level today at 2933.59. The last time this happened on Tuesday, SPX gained 1.67% on the following trading day.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could speed up should prices move above the close-by swing high at 2980.29 where further buy stops might get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior low" stand out. Its common bullish interpretation has been confirmed for S&P 500. Out of 416 times, SPX closed higher 59.13% 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 64.18% with an average market move of 0.36%.
With four out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are HSI losing -5.56% and NKY closing -0.8% lower. On the flipside the best performers have been NDX closing 0.38% higher and DAX gaining 0.07%. Read more