SPX500 Bears Are In Control Below 3400

02 July 2020

SPX500 might be ready to reverse lower in a dramatic fashion until prices stay below 3400 resistance (not seen on the chart here). The indice has been successful in carving an intermediary resistance around 3230 levels as bears prepare to resume lower again.

Let us have a look at the larger degree counts first. SPX500 had dropped from 3400 towards 2200 levels sub-dividing into 5 waves, which could be seen as a higher degree Wave (1) (not seen on the presented view). The subsequent rally between 2200 and 3230 has been a corrective zigzag labelled as A-B-C, also larger degree Wave (2) on the chart.

If the above larger degree wave counts are correct by any means, SPX500 should ideally remain below 3230 resistance and proceed towards 2200 levels at least. The fibonacci extensions of the larger wave are pointing towards 1750 levels.

Looking at the lower degree wave counts since 3230 highs, the drop to 2965 has sub divided into 5 waves, labelled as Wave 1 here. The recent since then has managed to reach 3155, just above the fibonacci 0.618 retracement of Wave 1. We have labelled this as potential Wave 2 termination, but kept room for another test of 3160 levels, before Wave 2 completes.

Either way, SPX500 along with other global indices is looking poised for a religious resumption of the sown trend any time soon. Watch out for a bearish reversal from current price action 3120 or from 3150/60, going forward.

Prepared by
Technical Analysis Team

Disclaimer: This information has been produced by a third party, for general information purposes only, and is not indicative of future results. Abans Global takes no responsibility for its accuracy or completeness. Any opinions expressed do not reflect those of Abans Global. This information does not take into account your personal circumstances or objectives, and should therefore not be interpreted as financial, investment or other advice, or relied upon as such. You should seek independent advice before making investment decisions. Reproduction of this information, in whole or in part, is not permitted. Please note: If you are a Professional client, you are not eligible for negative balance protection and you could lose more than your initial deposit.

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