Stock index S&P 500 continue to move as part of the correction and the formation of the “Head and Shoulders” reversal pattern. Moving averages indicate a short-term uptrend. Prices broke through the area between the signal lines downward, which indicates pressure from the sellers of the asset and a potential continuation of the fall of the stock index in the market from the current levels. At the time of the publication of the forecast, the index is trading at 4293. At the moment, we should expect an attempt to develop a rise and test the resistance level near the 4355 area. Where can we expect a rebound and the continuation of the fall in the S&P 500 quotes to the area below the level of 4185.
S&P 500 Forecast and Analysis July 20, 2021
An additional signal in favor of reducing the stock index quotes will be a test of the resistance line on the relative strength index (RSI). The second signal will be a rebound from the upper border of the ”Head and Shoulders” reversal pattern. Cancellation of the option of falling index quotes will be a strong growth and a breakdown of the area of 4405. This will indicate a breakdown of the resistance level and continued growth of the S&P 500 index quotes with a target above the level of 4635. Expect an acceleration of the fall in stock index quotes with the breakdown of the support area and closing of quotations below the 4235 area, which will indicate a breakdown of the lower border of the ”Head and Shoulders” pattern.
S&P 500 Forecast and Analysis July 20, 2021 suggests an attempt to test the resistance level near the area of 4355. Then, the continuation of the fall to the area below the level of 4185. In favor of reducing the S&P 500 quotes, a test of the trend line on the relative strength index (RSI) will come out. Cancellation of the fall option will be a strong growth in the value of the index and a breakdown of the 4405 area. This will indicate a continued rise with a target above the 4635 area.
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