Thursday's Market Minute: S&P Futures Making New Highs As Critical Earnings Loom

S&P 500 futures notched a +2.06% gain yesterday and continue to make new highs, this time eclipsing the previous highwater mark from July 21. But it’s also a crucial earnings day with Amazon AMZN, Apple AAPL, and Intel INTC reporting after the closing bell, so the landscape could change quickly.

The contract yesterday broke above the 63-day Exponential Moving Average, which is a bullish sign. Additionally, two moving averages that are commonly followed by traders in the 21-EMA and the 63-EMA both transitioned from a downward slope to an upward slope, which could be a positive development for trend watchers. However, volume has not been especially high, and clocked in below the 50-day Simple Moving Average for the past 10 trading days. This could speak to a lower degree of conviction on the part of bullish traders. 

In terms of support, the 63-EMA is now a spot to watch to the downside as it will be important for bulls to hang on to this level because not only is it a more significant moving average due to its length, but it also matches up roughly with the 4,000 level which could be another psychologically important level for traders. For resistance, the yearly Linear Regression Line (which represents a “line of best fit” through the closing prices, and is used as support/resistance) could be a potential stalling point to the upside near 4,043.

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