S&P 500 Index: Bulls Still Around to Challenge the 4449 All-time High

Falling energy stocks and a surprise jump in the producer price index (PPI) are weighing on this Thursday’s S&P 500 index. The Bureau of Labor Statistics reported that the seasonally adjusted PPI for July 2021 came in at 1.0%, the same as the previous figure but exceeded market expectations. Analysts had predicted a PPI of 0.6%. The weekly unemployment claims data came in at 375K, matching expectations. It was only a marginal drop from the previous figure of 387K.

The surprise PPI figure keeps tapering in the spotlight. Furthermore, the rise in US long-term bond yields favoured financial stocks only marginally. Instead, the Tech index opened lower by 0.35%, although it is slowly erasing these losses. 

The Energy index continues to weigh on the index, dropping off by 1.15% as of writing as weaker oil prices continue to dampen oil stocks. The S&P 500 index is marginally lower by 0.02% as of writing and continues to trade just off Wednesday’s all-time high of 4449.44.

Technical Outlook for S&P 500 

A break of Wednesday’s ATH at 4449.44 opens the door for the index to aim for the 100% Fibonacci extension of 4453.54, which could serve as the immediate upside target. Above this level, the 127.2% Fibo extension at 4561.95 serves as an additional barrier. 

On the flip side, an emerging, rising wedge could be the trigger for a correction on the S&P 500 index. This move needs to break down the wedge’s lower border and the 4422.92 support to bring in 4393.03 into the picture. The 4368.58 and 4324.44 support levels are additional targets to the south, which may then complete the wedge’s measured move and some. 

S&P 500 Index: Daily Chart

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