The S&P 500 index dropped to test the lower trendline of the ascending channel, which also corresponds to the support level of 4000.0, the 23.6% Fibonacci level, and the intersection of the 50-day moving average. It is likely that the price will rebound towards the level of 4085.0, with three potential scenarios:
1- The price fails to make a new high and tests the neckline of the Double Top pattern to continue its downward movement.
2- The price surpasses the level of 4085.0 and reaches the level of 4160.0, but fails to make a new high above the previous peak that lasted from February 1st to February 20th. Momentum indicators show a divergence indicating the formation of a Double Top pattern with a neckline at 4085.0.
3- The price surpasses both levels of 4085.0 and 4160.0 and aims to continue its upward movement in the current ascending channel, with a target of 4300.0.
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1- The price fails to make a new high and tests the neckline of the Double Top pattern to continue its downward movement.
2- The price surpasses the level of 4085.0 and reaches the level of 4160.0, but fails to make a new high above the previous peak that lasted from February 1st to February 20th. Momentum indicators show a divergence indicating the formation of a Double Top pattern with a neckline at 4085.0.
3- The price surpasses both levels of 4085.0 and 4160.0 and aims to continue its upward movement in the current ascending channel, with a target of 4300.0.
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Let me know your thoughts in the comments, and show your support by liking the idea.
Please follow if you're interested in more ideas like this.
Your support is greatly appreciated!
Trade closed: target reached
