Key insights
- The analysis suggests a short-term trading range for the S&P 500 futures ($ES) between 6825 and 6845. A break above 6845 could signal a move towards 6900+, while a break below 6825 might lead to a broader range down to 6645. The performance of individual stocks and sector ETFs, particularly in Banks & Finance as earnings season begins, will indicate market strength and potential leadership.
Futures:
A 4-500 point move since end of March suggests traders likely keep their options open and track activity at 6800s:
- Holding below 6845 at the start of the week suggests more time in balance. How deep or shallow the current pullback is- could be an indicator of short term trend continuation
- Going above and staying above 6845 resumes towards targeting 6900+
- Going below and staying below 6825 assumes a broader range between 6645 and 6825. Price discovery at 6700s then becomes likelier
If steadily back toward 6700s, the study moves to relative strength and whether the stronger stocks/names can lead when the index is in price discovery
The medium-term trend is consolidating while the shorter-term trend has been pointing up. So, it likely works as a blend of the two timeframes pending new buyers initiating
Stocks:
Individual names/stocks and Industry/Index ETFs will likely be a measure of how shallow or deep their pullback is from Friday’s highs and at what volume. The technically stronger names will likely stick out in their weekly and daily charts as Earnings season starts with Banks & Finance