The S&P 500 has fallen back towards what economists at Credit Suisse expect to define the bottom end of this range and key support levels at 4071/35, which includes the 63-day average and uptrend from November. They believe the choppy current consolidation can continue over the coming weeks, however the underlying bull trend remains strong and the index is eventually expected to move up to 4350 over the subsequent few months post this consolidation phase.
S&P 500 looks for further consolidation rather than a drawdown
“We maintain our base case of looking for a corrective/consolidation phase to emerge over the next few weeks, however we still believe the November uptrend at 4071, as well as the 63-day average and gap support at 4034/19 will floor the market to avoid a larger drawdown and keep the market in a consolidative range.”
“A close below 4020/19 though would instead warn of a more protracted and concerted setback with supports seen next at 3950, then 3920, where we would look for fresh buyers to show.”
“Above 4188 is needed to suggest the correction is already over for strength back to 4238, then 4260. Big picture, we look for a move to 4350.”
