18:47 SP500: Christmas Rally is Here
soared across the globe on Monday as managed to calm the markets at their weekend meeting with a 90 days truce in their trade conflict. The SP500 index was trading 1.7 percent stronger during the London session and jumped back above the 2,800 USD level.
The price is now testing the critical resistance of previous double highs again and the 100-day moving average, which are all converged near 2,815 USD. Considering the much overbought level, according to the RSI indicator, this might be considered as an entry point for bears to shorten this steep rally.
Stocks have advanced for six days in a row in a very steep move and therefore, some correction seems likely.
However, if bulls show more strength and the mentioned resistance is taken out, the index might rise toward the 2,900 USD level in a well-known Christmas rally.
On the downside, the first support could be at 2,785 USD and then at the 200-day moving average near 2,760 USD. As long as the SP500 index remains above the 200DMA, the short-term outlook seems bullish, but the price should jump beyond 2,815 USD to confirm this view.
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