The S&P 500 index surged to an intraday high of 4218.8 before retracing below the 4200 price level. This scenario means that the S&P 500 index has not only breached the 4200 upside target set by Credit Suisse some time ago, but it has also set a new record high.
Helping the S&P 500 index to new highs is the advanced GDP data, which grew from 4.3% to 6.4% on a quarterly annualized basis. Initial jobless claims fell marginally from 566K to 533K. These data confirm the Fed’s stance that while the US economic recovery is on track, the Fed’s targets for tapering or raising rates have not been met.
Technical Levels to Watch
After an intraday violation of the 4200 psychological resistance, there has been a pullback below this level. The S&P 500 index has touched off the all-time high at 4218.8; this is the level to beat for bulls. Credit Suisse analysts made a call several weeks ago of potential resistance at 4225 and 4250. The daily chart also shows the 200% Fibonacci extension at 4301.0 as an additional target to the upside.
On the flip side, if the bears pick up on the intraday rejection at the new resistance levels, we could see a further price dip towards 4150.4, with 4113.2 and 4062.8 serving as initial downside targets. Additional targets to the south include 4022.1, 3950.1 and 3910.5. Any of these could also serve as dip-buying areas.