US Equity Indices At Range Support – Another Rebound?

A big battle was fought between the bulls and bears on Monday. Initially, the bears had the upper hand due to the accumulated downward momentum seen last Friday. What is more, negative news – Brexit, trade war fears, etc – helped its cause. But during the session the bulls went in search of bargains and rolled back all the losses by close. This print long lower tails on indices’ charts.

For the S&P 500 Index, it did touch new multi-month lows intraday. But it was unable to break beneath the 2,600 support. For the Nasdaq Composite Index, technical support is observed at 6,800-6,900 (see below).

What now?

First, at range lows equity indices may stage another rebound from here. But the obvious question is: Will it last? The last rebound did not. Therefore traders are definitely more cautious now. Second, with the Fed meeting next week, perhaps investors are hopeful that the central bank may reduce its hawkishness. US long-term yields are falling. This may exert pressure on the Fed.

Overall, equity are still on a RORO mode, which dictates the strategy of ‘buy range low and sell range high’.

Good Money Guide Featured Providers

Trading Investing Spread Betting Currency Transfers CFDs

Visit IG Visit HL Visit ETX Capital Compare Quotes Visit CMC Markets
Looking for an institutional broker? Compare prime brokers here