S&P 500 Index: Break above 4299 reinforces the likelihood for further consolidation – Credit Suisse

The S&P 500 has seen a strong recovery above near-term resistance from its 13-day exponential average and recent high at 4299 and on increased volume. This maintains thoughts of a lengthier consolidation phase, which could still evolve into a bearish “triangle” pattern, analysts at Credit Suisse report.

Next key resistance test seen at 4363/87

“S&P 500 has cleared key near-term resistance from its 13-day exponential average and recent high at 4299 and on increased volume. This maintains thoughts of a lengthier consolidation phase and indeed a deeper recovery, which could still eventually evolve into a bearish ‘triangle’ continuation pattern.” 

“Resistance is seen next at the top of the early March price gap at 4363, then the 38.2% retracement of the 2022 fall and downtrend from early January at 4384/87. Our bias is to try and look for a cap here for now to define the top of the potential “triangle”.” 

“Above 4387 would suggest the recovery can extend further to the 4417 March high, potentially what we would expect to be much tougher resistance at the 200-day average at 4468.” 

“Support is seen at 4323 initially, then the 13-day exponential average at 4288/84. Below 4252 though is needed to see the risk turn lower again for a fall back to the recent lows at 4173/58.”