sp 500 2148 support to watch for potential direct rise 1822062016

Daily Outlook, Tues 19 July 2016

(Click to enlarge charts)

What happened earlier/yesterday

The U.S. SP 500 Index (proxy for the S&P 500 futures) has traded sideways after hitting last week high of 2174.  Till to date, this sideway range configuration is evolving within a tight 19 points from last Friday, 15 July low of 2155 as market awaits for fresh catalysts perhaps from more upbeat Q2 earnings announcements from key companies in order for it to push higher towards new highs.

Please click here for more details as per highlighted in our latest weekly/medium-term technical outlook/strategy published yesterday, 18 July 2016.

Today’s key U.S. economic data releases/events as follow:

• Housing Starts (m/m) for Jun @1230GMT (1.170m consensus)
• Building Permits (m/m) for Jun @1230GMT 1.150m consensus)
• Goldman Sachs Q2 earnings (3.05 EPS consensus)
• Johnson & Johnson Q2 earnings (1.68 EPS consensus)
• Microsoft Q2 earnings (0.58 EPS consensus)

Key elements

• Despite the recent sideways movement, the Index is still holding above its key short-term support at 2148 which is defined by the minor swing low area of 13 July 2016 and the 23.6% Fibonacci retracement from the 06 July 2016 low to 14 July 2016 high of 2174.
• The next short-term resistances stands at 2194 follow by 2222 which are defined by Fibonacci projection clusters.
• The daily RSI oscillator still has some room left for a potential push up before reaching an extreme overbought level. These observations suggest that upside momentum of price action remains intact.

Key levels (1 to 3 days)

Intermediate support: 2158

Pivot (key support): 2148

Resistances: 2194 & 2222

Next support: 2120 (medium-term pivot)

Conclusion

Maintain bullish bias. As long as the 2148 daily short-term pivotal support holds, the Index is likely to stage another round of potential upleg to target the next resistances at 2194 and even 2222 in the first step.

However, a break below the 2148 short-term pivotal support may negate the preferred bullish tone to see a deeper pull-back to test the current medium-term pivotal support at 2120.

Disclaimer

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