The S&P 500 index and other US indices rose into positive territory on Friday following the disappointing non-farm payrolls (NFP) report. Boosting the performance of the S&P 500 index was the Technology index, which rose 1.74% on Friday (as of writing). The index is risk-sensitive, and the faltering recovery in US jobs reinforces the Fed’s position on not tapering early. US Nonfarm Payrolls rose by 559K in May vs 645K market consensus.
Central to the bullish performance of the S&P 500 index in response to the jobs data is the Fed’s argument that slow jobs growth warrants delaying tapering of the Fed’s QE program and maintenance of near-zero rates until late 2022 or early 2023. This was good news for investors in the US markets, hence the inverse effect on the index.
Technical Levels to Watch
The surge in the S&P 500 daily candle of Friday is challenging the resistance at 4220.63. A break of this level allows the pair to aim for the current all-time high at 4228. A price advance beyond this point targets the 4260 and 4301.0 future resistance areas.
On the other hand, a rejection at 4220 allows bears to beat back the price towards 4176.61, with the broken neckline that served as the springboard for Thursday’s bounce forming an additional target at 4150.37. If the corrective decline is extensive, we could see a further dip towards 4120.48 and potentially 4082.72.