sp 500 daily outlook tues 08 sep 1968 is the potential upside trigger level 1239872015

(Click to enlarge charts)

Key elements

• Since the last upswing from the ‘Black Monday”, 24 August 2015 low of 1835, the U.S. SP 500 Index (proxy for the S&P 500) has started to evolve into a sideways. ‘Symmetrical Triangle” chart formation (as per highlighted in our latest weekly outlook here) (see 4 hour chart).
• The upper (resistance) and lower (support) of the “Symmetrical Triangle” stands at 1968 and 1910 respectively (see 4 hour chart).
• Current price action is coming close to the upper boundary of the “Symmetrical Triangle” at 1968. In addition, the short-term (1 hour) Stochastic oscillator is coming close to its extreme overbought level which indicates limited upside potential and a pull-back is imminent for the Index (see 1 hour chart).

Key levels (1 to 3 days)

Intermediate support: 1930

Pivot (key support): 1910

Resistance: 1968 & 1996

Next support: 1854

Conclusion

Based on the aforementioned technical elements, the Index needs to break above the 1968 intermediate resistance to trigger a further push up to test the 28 August 2015 swing high at 1996. Any potential pull-back is likely to be held by 1930 intermediate support with the maximum set at the 1910 daily pivotal.

On the contrary, failure to hold above the 1910 pivotal support (lower boundary of the “Symmetrical Triangle”) may see another round of decline to retest the 1854 support.

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