Will stocks finally break through key resistance?
The S&P 500 closed 1.67% higher on Wednesday, reaching a local high of 5,469.69 before pulling back amid mixed signals from the administration regarding tariff policies. Despite the gains, the index remains below the key resistance level of 5,500, extending its fluctuations following the early April tariff-induced sell-off.
Markets were buoyed Wednesday by President Trump's comments about potentially reducing steep trade tariffs on China, though Treasury Secretary Scott Bessent later clarified there was no unilateral offer to lower Chinese tariffs.
Today, the S&P 500 is expected to open 0.4% lower. Investors will be closely watching today's earnings releases from Alphabet (GOOG) and Intel (INTC) after the session closes, alongside further tariff-related developments.
Investor sentiment has worsened, as shown in yesterday’s AAII Investor Sentiment Survey, which reported that only 21.9% of individual investors are bullish, while 55.6% are bearish.
The S&P 500 pulled back from its recent highs, as we can see on the daily chart.
S&P 500 Futures Contract: Pullback from 5,500
This morning, the S&P 500 futures contract is trading along the 5,400 level after pulling back from its yesterday’s local high of around 5,500.
Key resistance remains around 5,500-5,550, with support at 5,300. The market is advancing, though this movement remains within its two-week consolidation.
Conclusion
The S&P 500's inability to break above 5,500 suggests continued resistance at this level. Today's tech earnings reports could provide the catalyst needed to determine the next move.
The market continues to be highly sensitive to trade policy developments, and volatility is likely to persist.
Here’s the breakdown:
- S&P 500 is expected to open 0.4% higher today, despite bearish sentiment readings.
- Investors are waiting for Alphabet and Intel earnings after today's close.
- It remains a news-driven market, with tariff developments in focus.
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Paul Rejczak
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