S&P 500 long setup as bulls defend long-term uptrend Fortune favours the brave. And after filling the gap created in June and bouncing off uptrend support dating back to when the Fed pivoted from rate cuts in November on Thursday, you get the sense it’s now or never for S&P 500 500 e-mini bulls. Either they’ll defend the level with the aim of testing the former highs or we’ll see a break lower. Until we see the break, we might as well help bulls with the fight.
I know the close below the 50-day moving average will be perceived as bearish, but bulls still managed to defend the uptrend despite a huge lift in volumes. The signals from RSI and MACD on momentum are also not great. But we’re not risking a huge amount of capital if we place a tight stop below the uptrend for protection, say at 5432. You could even wait for a push and close above the 50DMA before entering the trade, allowing for the stop to be raised.
Either way, if the trade works in your favour, consider raising your stop to entry level to provide free optionality on upside.
Potential targets include 5533, Thursday’s session high, along with 5631.5 which acted as support and resistance earlier this month. From there, we’re talking record highs.
If Microsoft can provide confidence on AI-driven revenues when it kicks off the next batch of Magnificent Seven earnings next week, it could easily flow through to Apple, Amazon and Meta that report later in the week.
DS
