S&P500 Weekly Ichimoku Analysis for Week 2 2023
General outlook for 
SPX
The overall market trend is still downwards and I expect that we will see more in Q1 downward pressure due to adjustment of earnings and the higher and higher possibility of, at least, a mild recession in the US and EU.
The FED will tighten the monetary policy further with one or two rate hikes of 25 bps in Q1. Furthermore, QT is running with 90 Trillion per month. This week all FED communication was clearly hawkish with statements that the terminal rate will be up to 5,4% in 2023 and no rate cuts in 2023. I will still act according to "never fight the FED". Therefore, all bullish signs are short-lived and any chance to sell into a rally should be still used.
Since mid-December the S&P in a range between 3.900 USD and 3.770 USD. As described above the overall market trend should still be bearish, at least in Q1 and Q2.
There the likelihood of a bullish break out over 3.900 USD is quite low in my opinion. In case there is a short-term bullish outbreak, this will be pushed back by the 1-year downward resistance line with sits at around 4.000 USD at the moment. Before this trendline is not broken and switched into support, I will be very cautious on the long side.
For next week I expect some volatility due to the inflation number. Especially as the inflation number in France and Germany came out lower than expected this week.
Ichimoku analysis
My weekly analysis is based on the 1D chart.
4H Resistance / Support Zone
Long Idea - Price Breaks above cloud resistance at 3960 USD and turns the 1-year downward resistance line into support. In my view, this will not happen in the next 3-4 months.
Short Idea - Price Breaks below the cloud and below 4H resistance at 3770 USD I will look for a retest of the support zone. If there is a retest this should be a good short opportunity.
Take Profit Target: 3565 USD (around 2022 yearly low)
Stop Loss: Above Base line
SPXThe overall market trend is still downwards and I expect that we will see more in Q1 downward pressure due to adjustment of earnings and the higher and higher possibility of, at least, a mild recession in the US and EU.
The FED will tighten the monetary policy further with one or two rate hikes of 25 bps in Q1. Furthermore, QT is running with 90 Trillion per month. This week all FED communication was clearly hawkish with statements that the terminal rate will be up to 5,4% in 2023 and no rate cuts in 2023. I will still act according to "never fight the FED". Therefore, all bullish signs are short-lived and any chance to sell into a rally should be still used.
Since mid-December the S&P in a range between 3.900 USD and 3.770 USD. As described above the overall market trend should still be bearish, at least in Q1 and Q2.
There the likelihood of a bullish break out over 3.900 USD is quite low in my opinion. In case there is a short-term bullish outbreak, this will be pushed back by the 1-year downward resistance line with sits at around 4.000 USD at the moment. Before this trendline is not broken and switched into support, I will be very cautious on the long side.
For next week I expect some volatility due to the inflation number. Especially as the inflation number in France and Germany came out lower than expected this week.
Ichimoku analysis
My weekly analysis is based on the 1D chart.
- Lagging Span is below the Price
- Base line is above Conversion Line
- Price is within the cloud -> Price ranging
- Currently Conversion Line, Base Line, and Kumo are flat / ranging
4H Resistance / Support Zone
- Resistance between 3885 USD and 3900 USD
- Support between 3785 USD and 3770 USD
Long Idea - Price Breaks above cloud resistance at 3960 USD and turns the 1-year downward resistance line into support. In my view, this will not happen in the next 3-4 months.
Short Idea - Price Breaks below the cloud and below 4H resistance at 3770 USD I will look for a retest of the support zone. If there is a retest this should be a good short opportunity.
Take Profit Target: 3565 USD (around 2022 yearly low)
Stop Loss: Above Base line
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