- Wall Street opens at similar levels to last night’s close
- Tuesday saw a strong rise for US stocks
- Rollover impact means prior levels should be treated with some caution
The US500 is trading flat shortly after the cash open, with the market consolidating on Tuesday’s large gains. Yesterday’s trade saw a strong move higher of more than 20 points as the panic surrounding North Korea’s latest missile launch subsided somewhat. Having said that, a daily chart shows that price remains not far from its all-time high at 2488.
The US500 remains close to its all time high of 2488 despite the North Korea situation and the political gridlock in Washington. Source: xStation
Unfortunately levels from a technical analysis perspective should be treated with some caution in the next few sessions due to the rollover seen on Monday night. For traders holding positions over the rollover the decline seen of around 17 points would be squared off with swap points so have no tangible impact. However previous levels, and several technical indicators will be skewed by the rollover in the short term due to the futures curve of the market.
With the market being in backwardation contracts further into the future are lower than the present. Therefore, will current price is around 2445, had the rollover not occurred it would be around 17 points higher. This means the recent price action is more positive than it appears.
The US500 remains well supported and a break above 2453 could lead to another move higher. Source: xStation
Levels seen since the rollover are more valid however with the recent high of 2453 a level to watch out for should price rise again. As for support, 2427 and 2420 could be important should the market take a turn lower.
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