This chart shows a bullish buy setup on the S&P 500 Index (SPX500USD) with various technical analysis tools applied to confirm a potential trend reversal and upward move.
Key Tools Used in the Analysis:
Trendlines (Yellow Lines)
The chart includes a long-term ascending trendline acting as a dynamic support.
Price recently bounced off this trendline, suggesting a strong demand zone where buyers are stepping in.
Fibonacci Retracement Levels
The 38.2% Fibonacci retracement level (5,372.6) is marked as a critical support zone.
The price has tested and bounced from this level, reinforcing a bullish reversal probability.
Support Zone (Green Box)
A strong demand area has been highlighted in green, indicating a historical support region where buyers have previously entered.
Breakout Potential (Blue Dashed Line)
The previous high (6,152.5) is identified as a resistance level.
The setup suggests an expected breakout if the price clears this resistance.
Projected Price Targets (Blue Arrows)
First target: 6,284 (+11.39%) - Short-term profit target.
Second target: 6,699 (+20.81%) - Long-term breakout target.
Drawdown Indicator (Red Area Below)
A drawdown indicator at the bottom suggests that the index has experienced a pullback, aligning with the support zone confluence.
Trade Execution Strategy:
Entry: At the current level (5,623.6) after the bullish bounce from the support zone.
Stop Loss: Below the 5,372.6 Fibonacci level to manage risk.
Take Profit Targets:
TP1: 6,284 (Short-term move)
TP2: 6,699 (Longer-term bullish continuation)
Conclusion:
This bullish reversal setup is based on trendline support, Fibonacci retracement, and historical demand zones. The risk-to-reward ratio is favorable, with the potential for a breakout rally if resistance levels are cleared.
Key Tools Used in the Analysis:
Trendlines (Yellow Lines)
The chart includes a long-term ascending trendline acting as a dynamic support.
Price recently bounced off this trendline, suggesting a strong demand zone where buyers are stepping in.
Fibonacci Retracement Levels
The 38.2% Fibonacci retracement level (5,372.6) is marked as a critical support zone.
The price has tested and bounced from this level, reinforcing a bullish reversal probability.
Support Zone (Green Box)
A strong demand area has been highlighted in green, indicating a historical support region where buyers have previously entered.
Breakout Potential (Blue Dashed Line)
The previous high (6,152.5) is identified as a resistance level.
The setup suggests an expected breakout if the price clears this resistance.
Projected Price Targets (Blue Arrows)
First target: 6,284 (+11.39%) - Short-term profit target.
Second target: 6,699 (+20.81%) - Long-term breakout target.
Drawdown Indicator (Red Area Below)
A drawdown indicator at the bottom suggests that the index has experienced a pullback, aligning with the support zone confluence.
Trade Execution Strategy:
Entry: At the current level (5,623.6) after the bullish bounce from the support zone.
Stop Loss: Below the 5,372.6 Fibonacci level to manage risk.
Take Profit Targets:
TP1: 6,284 (Short-term move)
TP2: 6,699 (Longer-term bullish continuation)
Conclusion:
This bullish reversal setup is based on trendline support, Fibonacci retracement, and historical demand zones. The risk-to-reward ratio is favorable, with the potential for a breakout rally if resistance levels are cleared.
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Disclaimer
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For Training visit.
Website wave-trader.com
Website techtradingacademy.com
Slack: wavetraders.slack.com
Telegram: t.me/Wavetraders
X: twitter.com/Wave__Trader
FB: facebook.com/WTimran
Website wave-trader.com
Website techtradingacademy.com
Slack: wavetraders.slack.com
Telegram: t.me/Wavetraders
X: twitter.com/Wave__Trader
FB: facebook.com/WTimran
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.