The S&P500 has consolidated in a triangular pattern in the past couple of weeks but kept its bullish bias. In fact, it gets ready to close in the green for the seventh consecutive week. As such, the higher highs and higher lows series that defines a bullish trend remains intact.
Today is the NFP day and the market participants focus on the impact of the US labor data on financial markets. The expectations are for the US economy to have added around one million new jobs last month, but revisions are key to today’s data.
Yesterday, the Dow Jones pushed to a new all-time high, spurred by low volatility and increased optimism in the economic recovery. Judging by the price action seen this week, the bias remains bullish, especially since the US equity markets optimism also influenced other markets, such as the European ones.
The move higher in the US stock market indices is also fueled by a weaker dollar. The EURUSD bounced from 1.20 and today climbed above Monday’s highs on talks of early tapering from ECB.
S&P500 Technical Analysis
Bulls may want to buy a break and close to a new all-time high, as such a move suggests the triangle acted as a continuation pattern. On the flip side, a move below 4120 is bearish and should trigger more downside.