S&P500 tunnels through as recession risk rises.
“Inflation continues to stay stubbornly high, further interest rate hike prompt recessionary risks.”
S&P500 notched in its worst slide since 2008 as the index fell more than 1% due to selloff on technology, energy, and industrial stocks. Sentiment among investors remain bleak as Federal Reserve continues its fight against stubbornly high inflation since early this year. Regardless, Fed’s approach which accelerated borrowing rates in a short period of time may spark recession sooner than later, prompting the market to reduce their risky holdings and turn over to safe havens.
Quick recap on S&P500
The index experienced substantial selloff as bulls gave up near 4100.
S&P500 Weekly Technical Analysis
From weekly perspective, MACD portrays diminishing bullish momentum, suggesting further downside ahead.
S&P500 Daily Technical Analysis
In terms of daily perspective, the index is expected to retest near 3759 whereby a close below this level would provide further confirmation of downside hypothesis.
ORDER: SELL STOP
STOP LOSS: 3810
Target 1: 3660
Target 2: 3600
ZFX Analyst’s Comment
With current momentum which is skewed towards the downside from both weekly and daily chart, we expect the index to extend its losses after closing below the nearest support.
Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
ZFX (Zeal Capital Market) is an FCA & FSA licensed online Forex & CFD broker providing more than 100 products for Forex, commodities, stock indices, and share CFDs. Open a trading account with min. USD 50 deposit and download our MT4 trading platform now!