S&P 500 Price Analysis: Testing resistance at 3,085 area – Confluence Detector
The S&P 500 Index has picked up momentum after a halfhearted opening and advances 0.7% with Wall Street on track to its best quarterly performance in decades. The combination of improving data and economic stimulus measures has eased concerns about the global increment of COVID-19 cases and has pushed the Index to session highs at 3,075, where the Technical Confluences Indicator shows some relevant resistance levels.
Right above the current level, the Indicator shows the 50-SMA on 4-hour charts meeting previous highs on 1 and 4-hour charts and the Pivot Point one-day R2. Above here at 3,098 the S&P 500 Index faces potential resistance from the Fibonacci 61.8% retracement level in one-week charts and then right above 3,100 with the Bollinger band on 1-day middle and the 100-SMA in 4-hour charts.
On the downside, there is an important support at 3,070 where the previous month’s high meets the 10-SMA in 15-minutes charts and below here, the 3,063 where the 38.2% Fibonacci retracement in one-week charts and the 100 and 5-SMAs in 1-hour charts meet.
Confluence Detector
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.