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S&P 500 started the session making fresh all-time high but turned negative after the first half-hour of the trading session. Dow Jones also turned negative at 27,968 while Nasdaq trades 0.14% higher at 8,562 as optimism that a trade deal between USA and China might be close boosted investors sentiment.
Earlier today, US Housing Starts in October rose 3.8% beating forecasts of 0.6% while the Housing Starts Change came in at 3.8% topping expectations of 0.6% in October. The United States Redbook Index (month over month) came down to -0.3% on November 15 from a previous reading of 0.1%
S&P 500 getting a boost from Biogen Inc. +2.51%, Broadcom Inc. +2.20% and Constellation Brands Inc. +2.01%. On the other S&P dragged down by retailers as Macy’s Inc. is 10.19% lower, Nordstrom Inc. -6.89% and Home Depot Inc. -5.45%.
S&P 500 Support and Resistance Levels
S&P 500 corrects from intraday record highs, as investors worry that the stock rally has gone too fast too far. A stop for breath might be a wise decision as investors looking for a fresh catalyst that will refuel the rally. The index has reached overbought levels as indicated in our daily chart by the RSI 14 index, currently trading at 70.75.
Today’s low at 3,111.8 will provide the first support, but a break below that level will increase the pressure to the next support at 3,083 the low from November 14th. If sellers clear this level, then the way will be open for a move down to the previous resistance that now has turned in support at 3,024.
On the upside, the S&P 500 immediate resistance stands at 3,127.64 today’s high, while a break above will attract fresh buyers targeting the 3,150 psychological mark.
Investors must be very careful at current levels, while the stock rally is well supported, by optimism on trade negotiations and by dovish stance by central banks around the world, including Fed, the possibility of a profit-taking correction can not be ruled out.
By Nikolas Papas, Market Strategist at Investingcube.com.
