S&P 500 Breaks The Four-Day Losing Streak

Key Insights

• S&P 500 has finally managed to find some support after falling for four trading sessions in a row. 
• At this point, the rebound looks technical, and it remains to be seen whether S&P 500 will be able to gain sustainable upside momentum. 
• A move above 3840 will push S&P 500 towards the resistance at 3860.

S&P 500 Rebounds As Traders Start Buying Stocks After The Strong Pullback

S&P 500 is moving towards session highs as traders continue to buy stocks after the strong pullback. NASDAQ Composite is up by 0.2% in today’s trading session.

The main event of the day is the BoJ decision to widen its yield curve control. BoJ moved the cap from 0.25% to 0.5% for the yield of the 10-year government bonds.

This decision led to a huge sell-off in USD/JPY and caused a major pullback in Japanese government bond markets. Other countries have also felt the impact of the BoJ decision, and rates moved higher in many markets.

In the U.S., the yield of 10-year Treasuries rallied towards the 3.70% level, which was bearish for the yield-sensitive tech stocks, although they managed to gain some ground in today’s trading session.

Tesla is the biggest loser in the S&P 500 today as traders remain worried that Elon Musk’s focus on Twitter will hurt Tesla. The recent reports suggesting that Elon Musk was actively searching for a new Twitter CEO failed to provide any support to Tesla stock.

General Mills is down by 4% despite beating analyst estimates on earnings and revenue. It looks that traders’ expectations were higher than analysts’ forecasts.

Basic materials stocks gained upside momentum today as precious metals markets enjoyed strong support.

S&P 500 Heads Towards The Resistance At 3840

S&P 500 is currently moving towards the resistance level at 3840. In case S&P 500 manages to settle above this level, it will head towards the next resistance at 3860. A successful test of the resistance at 3860 will push S&P 500 towards the next resistance at 3900.

On the support side, the nearest support level for S&P 500 is located at 3815. If S&P 500 declines below this level, it will head towards the 3800 level. A move below 3800 will push S&P 500 towards the resistance at 3775.

For a look at all of today’s economic events, check out our economic calendar.