The S&P 500 Index is seen at risk still to a deeper setback to price and potential trend support at 4469/58. Economists at Credit Suisse look for this zone to then try and hold for a resumption of the core uptrend.
See: Two factors to fuel a near-term correction in US stock indices – Morgan Stanley
Current setback is a temporary corrective decline only
“We continue to see scope for a lengthier consolidation/corrective phase for a test of the 4469/58 recent low and potential uptrend from July. Our bias would be to then look for an attempt to establish a fresh floor here for a resumption of the core underlying uptrend.”
“Resistance moves to 4517 initially, with a break above 4529/30 now needed to reassert an upward bias for a move back to the 4546 current high. Above here in due course can see resistance next at 4565 ahead of 4600/15.”
“Below 4458 would warn of a deeper corrective setback to test the rising 63- day average, currently seen at 4385.”
“The VIX rebound has been capped ahead of its key 200-day average to add weight to the view the recent market weakness is still more likely a temporary and corrective setback only within the core uptrend.”
