S&P 500 Tests Record Highs, Bulls Eye Next Leg
The S&P 500 remains firmly entrenched in a long-term uptrend, trading within a well-defined ascending channel and comfortably above both its 200-day and 200-week simple moving averages, according to a brief released by one of South Africa’s largest banks.
While overall market sentiment has softened slightly, the broader backdrop remains neutral rather than bearish, with investors balancing geopolitical risks, inflation concerns, and shifting central bank expectations.
The index is now testing a key resistance level near 7 620, placing markets at an important technical inflexion point, First National Bank (FNB) said in a brief on Monday,
The bank said from a technical perspective, a decisive break above 7 620 would confirm the continuation of the current Elliott Wave 5 advance, potentially opening the way towards the upper boundary of the channel near 8 280.
Failure to break higher could trigger a period of consolidation or correction, with initial support located near 7 020 and stronger support around 6 560, should selling pressure intensify. Despite these risks, the primary trend remains constructive as long as the index holds above key support levels.
“The outlook remains broadly positive, with our AI-generated forecast model pointing to continued strength over the medium term”.
While some consolidation is expected over the coming months, the technical picture suggests that the current move is more consistent with a pause within an ongoing bull market rather than the beginning of a sustained downturn, FNB added.
For investors, it said the key signal to watch is whether the index can successfully clear 7 620, which would reinforce the case for another leg higher in one of the strongest equity rallies of recent years.
