S&P 500 Index: Clear break below 4199 to open up further losses towards 3855/15 – Credit Suisse

The S&P 500 saw an aggressive fall yesterday of nearly 2%. Analysts at Credit Suisse look for a clear break (and ideally weekly close) below 4199 to signal an important change of trend lower with the next meaningful support seen at 3855/15.

Break of 4223/4199 to establish a major “head & shoulders” top

“We look for a clear break (and ideally weekly close) below 4199 to mark the completion of a large ‘head & shoulders’ top to signal an important change of trend lower. We would then see next support at 4122/17 ahead of the lows from May last year at 4061/57.” 

“Whilst we would look for an initial hold at 4061/57 we would expect a break in due course with the next meaningful support seen at the 38.2% retracement of the entire 2020/2021 bull market at 3855/15. The ‘measured top objective’ though is seen set lower at 3625/20.” 

“Resistance is now seen at 4267 initially, then 4310, with the immediate risk seen lower whilst below 4342.”