The S&P500 Futures (CME: ES) ended Wednesday’s trading session in the red as the debt ceiling crisis continued to weigh on the index, capping its upside reaction to Nvidia Inc (ISIN: US67066G1040), a top-five company by market capitalisation, posting upbeat earnings. The index is down 1.41% week-to-date as traders tread cautiously amid a potential U.S. Default.

The FOMC minutes revealed that Fed officials are tilting more towards a less restrictive monetary policy, compared to a month ago, when they were more divided in the outlook. However, the door remains open to more rate hikes if economic data points to their need. The less restrictive view could support the S&P500 Futures and provide tailwinds if interest rates are actually at their peak.

Técnicos

The S&P500 Futures have, in the past weeks, moved higher, with risk sentiment returning to the market. Traders were confident in the index and bought into it enough to push the price into an uptrend above the 100-day moving average and within an ascending channel pattern. Support and resistance were formed at 4115.25 and 4224.75 in the process.

This week, the S&P500 Futures have been pressured lower by the ongoing Debt ceiling crisis. A rejection of resistance took the index to its support level, where price action paused as traders reassess market dynamics.

A reversal from resistance is likely if bullish traders follow a textbook example of going long from support. Bulls will likely aim for the 4224.75 level if they commit to the upside with substantial volumes. Alternatively, a breakdown below the 4115.25 level on high volumes could expose the market to the downside, with the 4070.00 level the next likely point of interest for bears.

Resumen

With the U.S. Labour Market Report and Core PCE Index looming, traders will likely wait on the sidelines in anticipation of the critical economic data. If unemployment picks up steam as per consensus, while the Core PCE index remains stable, a rate pause could be validated to benefit equities, which will likely escape higher borrowing costs with the potential of a decline in interest rates imminent.
Fuentes: CNBC, Reuters, TradingView