The S&P 500 index resumed its bearish move after Monday’s recovery. The index and other US markets opened the day steeply lower after concerns over present geopolitical tensions. The expectations of a very hawkish outcome from Wednesday’s Fed meeting also added to investor caution.
Some bargain hunting crept into the trading session, with some investors snapping up stocks perceived to be at bargain prices. This allowed the index to pare about 70% of its earlier losses.
However, sentiment remains negative as tensions continue to mount along the Russia-Ukraine border. NATO and the US are putting forces on alert and are moving heavy military equipment to the region to counter a potential Russian invasion.
The SP 500 has fallen nearly 10% from its 4 January peak and currently trades 1.57% lower on the day.
SP 500 Index Outlook
The 4300 price level is currently serving as the intraday support level, as this is where the active daily candle has bounced from. To restore bullish momentum, the bulls need to push the bounce above the 4368 price resistance. However, only a close above the resistance at 4422 provides the higher high that signals a continuation of the recovery movement.
Otherwise, a rejection at 4368 allows for a resumption of the bearish move that retests 4300. Below this support level, 4233 (Monday’s support and 19 July 2021 low) serves as the next target in line for the bears.