Technicals | Jan 24 2023
By Michael Gable
Share markets continue to sit at difficult levels here. The difficultly is because the S&P500 Index is at a major resistance level, and the S&P/ASX200 Index in the past few weeks has disconnected from the US and given us a V-shaped rally where it is now looking overbought.
We are not calling for a big sell-off from here, but the risk/reward for any new trades right here is not very good at the moment. We still need to see clearer signs on what the next path is likely to be.
This week's report has a chart of the S&P 500 Index to show why current levels are being closely watched.
The S&P500 Index remains at a key level here. Overnight, it has managed to close marginally above the downtrend line and the 200-day moving average.
If it can hold here for a few days, and push above 4100, then we would be looking for a retest of the August high near 4300 as the next upside target.
However, any sharp moves down for here, especially a dip under 3900, would open it up to lower levels where we would be targeting support in the 3600-3700 region.
At the moment, we need to wait and see.
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Michael is RG146 Accredited and holds the following formal qualifications:
• Bachelor of Engineering, Hons. (University of Sydney)
• Bachelor of Commerce (University of Sydney)
• Diploma of Mortgage Lending (Finsia)
• Diploma of Financial Services [Financial Planning] (Finsia)
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2
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