Hello and welcome back to DP,
**Review and News**
Yesterday, at the start of the week, the SPX opened with a significant upside gap, largely driven by a tweet from former President Trump on Friday. His statement—"Don’t worry about China and Xi, they don’t want a recession for their economy, and neither do we"—helped restore investor confidence, pushing them back into the market, particularly into this index. However, shortly after, Trump reiterated that tariffs would still be implemented on November 1st, which is expected to have a considerable impact.
This morning, President Xi reaffirmed his stance, saying, "China will fight to the end, but the doors for negotiation are always open." As seen on the chart, the price has moved within a range between $6,681 and $6,584.
**4-Hour Price Action**
As indicated by the chart, the price range between $6,681 and $6,584 seems to be holding steady for now. One scenario suggests the market is in a consolidation phase. The shape of this consolidation will depend on the future performance of the market. It could either form a diagonal pattern or remain within a box range, as investors battle against short-sellers.
Using Fibonacci retracement, it appears the price may extend to the 0.236 line at $6,706. If this Fibonacci level holds, the market could face a downturn, potentially targeting the next support level indicated by the red box below the chart.
**Trend Analysis**
As shown, the trend illustrates a clear relationship with price movement. The price opened above the trend line, then expanded below the next trend level, showing respect for it. This movement suggests that downward pressure remains, with the market's direction depending on the break of the current trend line.
Personally, I believe the market may head south, but it won’t be a straightforward move. The decline could be unpredictable and happen quickly, or it may unfold in more gradual, choppy moves. One thing to be certain of is that retail traders are betting against the market, mainly due to the gap being filled. However, caution is advised when trading this index. It’s important to wait for confirmation before making any decisions.
**Review and News**
Yesterday, at the start of the week, the SPX opened with a significant upside gap, largely driven by a tweet from former President Trump on Friday. His statement—"Don’t worry about China and Xi, they don’t want a recession for their economy, and neither do we"—helped restore investor confidence, pushing them back into the market, particularly into this index. However, shortly after, Trump reiterated that tariffs would still be implemented on November 1st, which is expected to have a considerable impact.
This morning, President Xi reaffirmed his stance, saying, "China will fight to the end, but the doors for negotiation are always open." As seen on the chart, the price has moved within a range between $6,681 and $6,584.
**4-Hour Price Action**
As indicated by the chart, the price range between $6,681 and $6,584 seems to be holding steady for now. One scenario suggests the market is in a consolidation phase. The shape of this consolidation will depend on the future performance of the market. It could either form a diagonal pattern or remain within a box range, as investors battle against short-sellers.
Using Fibonacci retracement, it appears the price may extend to the 0.236 line at $6,706. If this Fibonacci level holds, the market could face a downturn, potentially targeting the next support level indicated by the red box below the chart.
**Trend Analysis**
As shown, the trend illustrates a clear relationship with price movement. The price opened above the trend line, then expanded below the next trend level, showing respect for it. This movement suggests that downward pressure remains, with the market's direction depending on the break of the current trend line.
Personally, I believe the market may head south, but it won’t be a straightforward move. The decline could be unpredictable and happen quickly, or it may unfold in more gradual, choppy moves. One thing to be certain of is that retail traders are betting against the market, mainly due to the gap being filled. However, caution is advised when trading this index. It’s important to wait for confirmation before making any decisions.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.