With US stocks bouncing on Trump’s backtracking over tariffs — just weeks after a 20% correction — it’s fair to say caution is the name of the game. Even though the headline risk has eased slightly, markets are still navigating through a fog of geopolitical noise and economic uncertainty.
In moments like these, where the fundamental picture feels muddy at best, objective technical analysis can offer clarity — not crystal-ball predictions, but structure and focus.
The Traditional Technical Backdrop
Traditional technical analysis isn’t about magic lines on a chart — it’s about mapping out price behaviour with tools that help us stay grounded. Structural levels, trendlines, and a couple of moving averages might seem basic, but they’ve stood the test of time because they do something incredibly useful: they make sense of chaos.
In the case of the S&P 500, several key structural levels should anchor any serious analysis. We’ve got the pre-sell-off highs from February, the April lows, and two interim levels — broken support levels that flipped to resistance during retracement rallies between February and April. These levels now act like milestones in the market’s memory.
Drawing a downward-sloping trendline through the swing highs during the correction gives us a good sense of the broader downtrend. More recently, we’ve also started to see a modest uptrend emerge from the April lows. That creates something of a wedge formation — a narrowing range that’s coiling tighter as buyers and sellers battle it out.
Simple moving averages like the 50-day and 200-day are useful additions here. While they’re lagging by nature, they give us immediate context for where price sits in relation to recent momentum and long-term sentiment.
US500 Daily Candle Chart
Past performance is not a reliable indicator of future results
The Indicator to Watch
There’s a good argument to be made that the most important indicator to watch right now, with the S&P 500 trying to claw back ground, isn’t a moving average or RSI — it’s Anchored VWAP.
Anchored Volume-Weighted Average Price (VWAP) is one of the most effective ways to cut through the noise and see who’s really in control — buyers or sellers. It tells you the average price that traders have paid for the index, weighted by volume, since a specific event or turning point. And unlike regular VWAP that resets daily, Anchored VWAP lets us choose a significant date and track how price interacts with that “anchor.”
If we anchor the VWAP to the February highs, we’re essentially tracking how the market has performed relative to that peak. This anchored VWAP line becomes a kind of gravity — it reflects the average cost basis of those who bought just before the sell-off. If price remains below it, it tells us those buyers are still underwater, and therefore less likely to add risk. Sellers, in that case, still hold the advantage.
On the flip side, if we anchor VWAP to the April lows, we get the average cost basis of the recent bounce. This line reflects where more optimistic, bottom-fishing buyers stepped in. If price holds above this level, it suggests those participants remain in profit — and potentially willing to buy dips.
Right now, the S&P 500 is stuck in a battle between these two anchored VWAP levels. One tracks the pain, the other tracks the hope. It’s a VWAP funnel, and it won’t last forever. Eventually, price will break above one and leave the other behind — and when it does, we’ll have an objective answer as to which side is winning.
Will it be the late bears holding on from February’s highs, or the early bulls from the April lows? The answer is coming. Keep your eyes on the anchored VWAPs — they’re telling the real story.
US500 Daily Candle Chart
Past performance is not a reliable indicator of future results
Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 83% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
In moments like these, where the fundamental picture feels muddy at best, objective technical analysis can offer clarity — not crystal-ball predictions, but structure and focus.
The Traditional Technical Backdrop
Traditional technical analysis isn’t about magic lines on a chart — it’s about mapping out price behaviour with tools that help us stay grounded. Structural levels, trendlines, and a couple of moving averages might seem basic, but they’ve stood the test of time because they do something incredibly useful: they make sense of chaos.
In the case of the S&P 500, several key structural levels should anchor any serious analysis. We’ve got the pre-sell-off highs from February, the April lows, and two interim levels — broken support levels that flipped to resistance during retracement rallies between February and April. These levels now act like milestones in the market’s memory.
Drawing a downward-sloping trendline through the swing highs during the correction gives us a good sense of the broader downtrend. More recently, we’ve also started to see a modest uptrend emerge from the April lows. That creates something of a wedge formation — a narrowing range that’s coiling tighter as buyers and sellers battle it out.
Simple moving averages like the 50-day and 200-day are useful additions here. While they’re lagging by nature, they give us immediate context for where price sits in relation to recent momentum and long-term sentiment.
US500 Daily Candle Chart
Past performance is not a reliable indicator of future results
The Indicator to Watch
There’s a good argument to be made that the most important indicator to watch right now, with the S&P 500 trying to claw back ground, isn’t a moving average or RSI — it’s Anchored VWAP.
Anchored Volume-Weighted Average Price (VWAP) is one of the most effective ways to cut through the noise and see who’s really in control — buyers or sellers. It tells you the average price that traders have paid for the index, weighted by volume, since a specific event or turning point. And unlike regular VWAP that resets daily, Anchored VWAP lets us choose a significant date and track how price interacts with that “anchor.”
If we anchor the VWAP to the February highs, we’re essentially tracking how the market has performed relative to that peak. This anchored VWAP line becomes a kind of gravity — it reflects the average cost basis of those who bought just before the sell-off. If price remains below it, it tells us those buyers are still underwater, and therefore less likely to add risk. Sellers, in that case, still hold the advantage.
On the flip side, if we anchor VWAP to the April lows, we get the average cost basis of the recent bounce. This line reflects where more optimistic, bottom-fishing buyers stepped in. If price holds above this level, it suggests those participants remain in profit — and potentially willing to buy dips.
Right now, the S&P 500 is stuck in a battle between these two anchored VWAP levels. One tracks the pain, the other tracks the hope. It’s a VWAP funnel, and it won’t last forever. Eventually, price will break above one and leave the other behind — and when it does, we’ll have an objective answer as to which side is winning.
Will it be the late bears holding on from February’s highs, or the early bulls from the April lows? The answer is coming. Keep your eyes on the anchored VWAPs — they’re telling the real story.
US500 Daily Candle Chart
Past performance is not a reliable indicator of future results
Disclaimer: This is for information and learning purposes only. The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance. Social media channels are not relevant for UK residents.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 83% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
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.
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.