The S&P 500 stays under pressure as peak inflation narrative collides with US-Iran crisis
FUNDAMENTAL OVERVIEW
The S&P 500 has been mostly rangebound in the past couple of weeks as the US-Iran crisis brought back inflation and growth risks. This has also happened amid overcrowded stock market positioning which has led to deleveraging across the board.
The peak inflation narrative got stronger following this week’s soft US inflation data which triggered a dovish repricing in interest rate expectations. Nevertheless, the US-Iran risk in the background is weighing on sentiment dragging the stock market lower and limiting the upside.
Moreover, the Fed is keeping a tightening bias, so that’s also a negative driver as the central bank might be slower in reacting to worsening economic data in case things deteriorate.
Looking ahead, traders will continue to focus on US-Iran headlines. As long as the escalation continues, the market will likely remain under pressure. On the other hand, a resolution and clear de-escalation should trigger a rebound and potentially take us to new record highs.
S&P 500 TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see the S&P 500 rejected the resistance around the 7,630 level as the sellers stepped in with a defined risk above it to position for a drop into the 7,200 level next. The buyers will want to see the price breaking above the resistance to open the door for new highs.
S&P 500 TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we have a minor support zone around the 7,475 level. We can expect the buyers to step in around the support with a defined risk below it to position for a rally back into the resistance. The sellers, on the other hand, will want to see the price breaking lower to increase the bearish bets into the 7,357 level next.
S&P 500 TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, there’s not much we can add here as the buyers will have a better risk to reward setup around the support, while the sellers will need to wait for a break to open the door for new lows. The red lines define the average daily range for today.
UPCOMING CATALYSTS
Today, we conclude the week with the University of Michigan Consumer Sentiment report, but the focus remains on US-Iran headlines.
This article was written by Giuseppe Dellamotta at investinglive.com.提供 MainLink：Investinglive RSS Breaking News Feed
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