New Top Trend Analysis of S&P 500 Reveals Momentum Insights

New Top Trend Analysis of S&P 500 Reveals Momentum Insights

What to watch: Series of US labour market data this week

With US policymakers shrugging off the hotter-than-expected consumer price index (CPI) prints over the past months and asserting that the path of inflation towards its 2% target will be a “bumpy road”, they will remain on the lookout for the conviction that the disinflationary trend will continue. A series of labour market data will be up ahead this week, and eyes will be on any signs of softening in labour conditions to offer room for an earlier policy easing.

Today will bring the US job opening numbers for February in focus, where expectations are for a fall in job openings to 8.74 million at a four-month low, down from previous 8.86 million. This is followed by the US services Purchasing Managers’ Index (PMI) on Wednesday, before the week rounds off with the key US non-farm payroll report. Expectations are for the US economy to add 200,000 jobs in March, down from the 275,000 in February, while the unemployment rate is expected to stay unchanged at 3.9%.

S&P 500 technical analysis: Rising channel pattern remains

The S&P 500 remains in its rising channel pattern since the start of the year, with the series of higher highs and higher lows thus far reinforcing an upward trend in place. It may seem that as long as the lower channel trendline support holds at around the 5,200 level, the bullish bias will remain. Its daily relative strength index (RSI) has also been trading above the key 50 level since November 2023, reflecting buyers broadly in control. Further upside may potentially leave the 5,360 level on watch, where the upper channel resistance stands. On the other hand, if the lower channel support were to give way, it may prompt a deeper retracement to the 5,070 level where its 50-day moving average (MA) stands.

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