The S&P 500 index has opened higher and well above the 3400 mark after stimulus hopes jumped on the latest comments by US President Donald Trump. Also, most of the data surrounding insured unemployment improved, according to the Department of Labor’s jobless claims report.
President Trump in a Fox Business interview seemed to make a volte-face when he gave indications that stimulus talks between both sides of the divide in the US Congress had progressed significantly. This was after calling off talks between both sides 48 hours ago. Trump indicated that both sides were “starting to have some very productive talks” just as the latest data on insured unemployment showed a marginal drop in initial jobless.
The S&P 500 index is up 0.56% as all indices measured showed gains this Thursday. The Energy Index is posting the best performance, as it is up nearly 2% on the day due to the rise in crude oil prices. The approach of Hurricane Delta in the US Gulf Coast has temporarily shuttered production in that area, helping the international oil benchmark to a 2.5% gain on the day.
Technical Outlook for S&P 500
Today’s bullish open sets the pace for the index to continue the upside trajectory after completion of the a-b-c corrective wave, with the index’s price action now attempting to confirm the break of the 3393.5 price resistance following yesterday’s violation of this price level.
A higher close above this level today confirms the break and puts price on the path towards 3481.6. Lining up ahead is the 3528.9 resistance, which is where the 26 August and 4 September highs are found.
On the flip side, lack of follow-through buying that leads to the daily candle closing below the 3393.5 price level delays the breakout. This scenario opens the door towards the 3335.5 support, with 3282.2 and 3228.4 lining up as potential support areas to the south.
S&P 500 Daily Chart