Technical Analysis – US 500 consolidates near 4-month highs
US 500 index trades sideways after posting fresh 4-month peak
Momentum indicators approach their overbought zones
Risk of a downside correction is increasing
Should buyers attempt to push the price even higher, immediate resistance could be found at the 2023 high of 4,606. Surpassing that zone, the index could ascend towards the March 2022 peak of 4,637. A break above that territory could open the door for the January 2022 resistance region of 4,750.
On the flipside, if the price experiences a pullback, the September peak of 4,540 could now act as the first line of defence. Should that barricade fail, the bears could attack the September support of 4,430. Failing to halt there, the price may challenge 4,342, which is the 23.6% Fibonacci retracement of the 3,486-4,606 upleg.Overall, the US 500 index has been facing persistent upside pressures in the past three weeks. However, the price could soon experience a pullback as the momentum indicators currently suggest that the advance is pretty much overdone.
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