sp 500 daily outlook wed 09 sep pull back before potential new rise above 1961 support 2125392015

(Click to enlarge charts)

What happened yesterday

The U.S. SP 500 Index (proxy for the S&P 500) has managed to break the upside trigger level at 1968 as expected. It has continued to surge in today’s (09 September 2015) European session and almost met our 1996 upside target (printed a current high of 1993.

Please click on this link for a recap on our previous daily outlook.

 Key elements

• The Index has staged a bullish breakout from its sideways “Symmetrical Triangle” configuration with pull-back support at 1961 (see 4 hour chart).
• The hourly (short-term) Stochastic oscillator has exited from its overbought region and still has room for further downside before reaching its extreme oversold level. This observation indicates a potential pull-back in price action of the Index (see 1 hour chart).
• The next significant resistance stands at 2040/2050 which is defined by the former range support formed in March/April 2015, a Fibonacci projection cluster based on the current price action and the upper boundary of the ascending channel (in dark blue) (see 4 & 1 hour charts).

Key levels (1 to 3 days)

Pivot (key support): 1961

Resistance: 2040/2050

Next support: 1931

Conclusion

Technical elements remain bullish but do expect a potential pull-back above the 1961 daily pivotal support before another upleg occurs to target the 2040/2050 resistance.

On the flipside, a break below the 1961 pivotal support may negate the bullish tone to see a slide to test the lower boundary of the ascending channe1 at 1931.

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