S&P500 (SPX) Price Analysis – May 03, 2023

Daily Price Outlook

The S&P 500 (SPX) index is down 1.16% today, trading at $4119.58. The US stock market fell after the start of the FOMC meeting on Tuesday. The US Federal Reserve Chairman, Jerome Powell, is expected to announce a 25 basis point rate hike, and his speech will be closely watched by investors for clues on future rate hikes. Investors are waiting for hints on interest rates and inflation, causing the stock market to experience flat movement.

After the collapse of First Republic Bank this week, concerns about a banking crisis re-emerged in the market, contributing to the negative movement.

Despite JP Morgan’s acquisition of the defaulted First Republic Bank, US Treasury Secretary Janet Yellen's statement that the US might hit the debt ceiling in early June added extra pressure to the market. This raised questions about the US economic condition.

Despite the recent bank failures causing a negative impact on the S&P 500 index on Tuesday, there have been positive reports from the earnings sector. 80% of S&P500 companies who have reported their Q1 earnings have experienced higher than expected profits, with Amazon expected to be the largest contributor to earnings growth in the Consumer Discretionary Sector.

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Pfizer reported better-than-expected profit in Q1 due to increased demand for their COVID products, with the company expecting new products to add to growth in future quarters.

Uber also reported a surge in Q1 revenue, which led to an 8.2% increase in share value. These gains helped to offset some of the losses in the S&P500 Index, which has been declining due to the banking crisis and upcoming Fed rate clues.

SPX Price Chart - Source: Tradingview

Daily Technical Levels:

Support Resistance

4113 4147

4097 4165

4079 4181

Pivot Point: 4131

SPX – Technical Outlook

The S&P 500 is currently experiencing sideways movement, hovering above 4,100 with a strong support level at 4,100. However, it might face resistance at 4,175 due to a double-top pattern. If the index surpasses this level, it could move towards the next resistance at 4,170.

On the other hand, if it falls below 4,040, significant selling pressure could lead to a decline towards the 3,920 and 3,840 levels. Technical indicators like MACD and RSI suggest a strong bullish trend.

Investors should keep a close eye on the 4,040 level as a candle closing above it might indicate an upward trend for the SPX today.