FxWirePro: S&P500 trapped in Bull/Bear fight; Bulls eye retest of peak while bears focus 2280 area

After a massive selloff rocked the resolve of the bulls since last Friday that pushed the S&P500 to as low as 2529, our calculations suggest that bears are finally more energized after long been sidelined by raging bulls. S&P500, which didn’t undergo even a 2 percent correction since 2016, declined more than 10 percent over the past two weeks before a bounce back.

While the index has recovered by almost 150 points and is currently trading at 2673, the selloffs might not be completely over.

Our calculations suggest that the bulls are looking to push the index higher seeing this selloff as a buying opportunity to test the January peak around 2875 area. At the same time, the calculations also suggest that the bears, which have not given up control completely are looking to push the index to as low as 2280 area.

The resistance area around 2775 would be vital to assess the future outlook, a break of which would significantly reduce the strength of the bears and put the index back on track for further gains. Expect sellers to emerge once S&P500 moves just above 2700 area.