S&P 500 Makes New ATH — Is This a Fake Breakout?

Jan 7

As I expected in the previous idea, the S&P 500 Index(SPX500) reached its targets, with a risk-to-reward ratio of 1:67.

The S&P 500 has managed to set new all-time highs as we entered 2026. The question now is whether the S&P 500 will continue its bullish trend throughout 2026 or if we should anticipate a correction in the U.S. stock market.

It’s important to note that the S&P 500 is a key index for the markets, and its correlation with Bitcoin(BTCUSDT) is quite high. Therefore, it’s always beneficial to keep an eye on the S&P 500 when analyzing the crypto market, especially Bitcoin.

Currently, the S&P 500 seems to be trading above the resistance zone($6,930_$6,892). However, considering the volume of this breakout, it doesn’t seem like a very convincing breakout.

From an Elliott Wave perspective, we might expect the main wave 5 of the S&P 500 to conclude with the help of an ending diagonal, and this wave 5 could complete near the upper lines of the ending diagonal.

I expect that the S&P 500 may decline at least to around $6,917, and if it breaks back below the resistance zone and the lower lines of the ending diagonal, we could see further declines to around $6,837 or even lower, leading to a downturn in the U.S. stock market.

Note: It’s worth noting that rising tensions in global affairs could also pose a risk to the S&P 500, potentially causing abrupt declines.

First Target: $6,917

Second Target: $6,837

Stop Loss(SL): $6,988

💡 Please respect each other's opinions and express agreement or disagreement politely.

📌S&P 500 Index Analyze (SPX500USD), 4-hour time frame.

🛑 Always set a Stop Loss(SL) for every position you open.

✅ This is just my idea; I’d love to see your thoughts too!

🔥 If you find it helpful, please BOOST this post and share it with your friends.

Jan 7

Trade active

Trade was activated when SPX500 touches the upper lines of the ending diagonal.

Jan 8

Trade closed: target reached

First Target Done