As the market continues to remain volatile, investors and traders alike are keeping a close eye on the the key resistance level that the S&P 500 has been trying to break for months.
It’s no secret that the S&P 500 has been the leader of the market recovery following the sharp decline witnessed earlier in the year. Over the course of the last few months the index has steadily risen and is now close to its pre-pandemic high.
However, despite these gains, the index has been unable to break above the key resistance level of 3383. This number shouldn’t come as a surprise to those who have been following the market since the start of 2020, as this was the level the S&P 500 was trading at prior to the sharp decline triggered by the coronavirus pandemic.
This means that the S&P 500 is faced with a relatively narrow trading range between this resistance level and the current support level of 3200. As long as these levels are not breached by either side, the index could experience some periods of consolidation.
Conversely, if the S&P 500 does break out of this range, the index will be in position to make a new 2020 high, which would be a strong sign that the economic recovery is underway. This could bring renewed investor confidence, and result in a surge in risk appetite that could drive markets higher.
The market’s reaction to the resistance level of 3383 is therefore key to determining the short-term direction of the market. For this reason, investors and traders should continue to keep a close eye on the S&P 500 and be prepared for a potential breakout if the resistance level is breached.
As the market continues to remain volatile, investors and traders alike are keeping a close eye on the the key resistance level that the S&P 500 has been trying to break for months.
It’s no secret that the S&P 500 has been the leader of the market recovery following the sharp decline witnessed earlier in the year. Over the course of the last few months the index has steadily risen and is now close to its pre-pandemic high.
However, despite these gains, the index has been unable to break above the key resistance level of 3383. This number shouldn’t come as a surprise to those who have been following the market since the start of 2020, as this was the level the S&P 500 was trading at prior to the sharp decline triggered by the coronavirus pandemic.
This means that the S&P 500 is faced with a relatively narrow trading range between this resistance level and the current support level of 3200. As long as these levels are not breached by either side, the index could experience some periods of consolidation.
Conversely, if the S&P 500 does break out of this range, the index will be in position to make a new 2020 high, which would be a strong sign that the economic recovery is underway. This could bring renewed investor confidence, and result in a surge in risk appetite that could drive markets higher.
The market’s reaction to the resistance level of 3383 is therefore key to determining the short-term direction of the market. For this reason, investors and traders should continue to keep a close eye on the S&P 500 and be prepared for a potential breakout if the resistance level is breached.
