SPX - The Strength in the Rally is Impressive
$S&P 500(.SPX)$ The Strength in the Rally is Impressive: The market reaction was notably different compared to previous U.S. debt credit downgrades.
With precision, the $5,901 set as central level last Friday acted as support zone today (the low was slightly below that line, hence the importance of setting stops below the exact level, or being patient waiting for the 2H candles to be closed), and a reversal is unlikely until that level is breached. Anyway, I am paying attention to the upper Bollinger Band, which is curling downward, similar to patterns observed before previous healthy pullbacks.
You know my bullish stance mid term expecting a healthy pullback in the short term, which is still very soon to state it has been called off. The Volatility index bounced and retraced quickly today but anyway it missed to reach 21.8 to close the gap, so the pathway for further upside in the S&P500 is not completely cleared and prudence is key.
If there is a bullish continuation tomorrow, I’d pay attention to the RSI, which is nearing 70, the level from where the oscillator becomes overbought and from where more caution will be advised.
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