The main U.S. stock market indexes lost 0.4-0.7% in volatile trade yesterday, as investors reacted to the release of the minutes from the Federal Reserve’s last meeting. The S&P500 index extended its correction, approaching the June-August uptrend’s 50% retracement at 1,635.00. The nearest level of support is at 1,635-1,650, and the resistance level remains at 1,679.61-1,684.83, marked by the August 15 gap down, as we can see on the daily chart:

Technically speaking, the market is in a short-term downtrend. However, expectations before the opening of today’s session are quite good, with index futures gaining 0.3-0.6% right now. The European stock market indexes have gained 0.8-1.1%, reacting to some better than expected economic data announcements concerning the euro area. Investors will now wait for the U.S. economic data announcements: Initial Claims at 8:30 a.m. and Leading Indicators at 10:00 a.m. The S&P500 futures contract (CFD) breached the support level of 1,640-1,650, then quickly rebounded. The nearest resistance level is at around 1,650 now. There is no clear trend reversal signal, however, buyers hope to make profit here, expecting a larger upward correction. In the short term, the volatility is increased, as the 15-minute chart shows:

Thank you,
Paul Rejczak