SPX Continues to Fall Following the NFP ReleaseAfter the surprising report of 256k jobs created compared to the expected 160k, the U.S. index has experienced a decline of over 1% in the last trading hours. This is due to the perception that strong employment data could be counterproductive to the outlook for future interest rate cuts by the Fed.
Lateral Range:
Recently, the price has been trading within a significant lateral range between the 6k-point ceiling and the 5.8k-point floor. With the recent bearish movement, a break below the lower boundary of the channel could end the current consolidation and favor a new short-term bearish outlook. Sustained oscillations below the mentioned support level could define the next downward price movement.
RSI:
At the moment, the RSI is oscillating below the indicator's neutral 50 line. This indicates that bearish momentum dominates the market, with no signs of oversold conditions that might suggest potential bullish corrections.
Key Levels:
5.8k: This level currently serves as the relevant support zone, coinciding with the lower boundary of the lateral channel and the 23.6% Fibonacci retracement level. Persistent oscillations below this level could support a bearish outlook in the coming sessions.
6k: This represents the primary resistance level on the chart. Oscillations near or above this level could end the ongoing bearish pressure and pave the way for new all-time highs.
5.6k: The next significant support zone, aligning with the 38.2% Fibonacci retracement level. Oscillations near this level could lead to a solid bearish trend and completely negate the long-term uptrend that has been in place since August 2024.
By Julian Pineda, CFA - Market Analyst
