S&P 500 Analysis: Markets Start the Week on a Positive Note

A week ago, while analysing the S&P 500 index chart (US SPX 500 mini on FXOpen), we noted that the market had officially entered a correction phase, as the price had declined more than 10% from its February 19 peak. This drop was driven by mounting uncertainty over the potential economic damage caused by the Trump administration’s tariff policies in international trade.

However, this morning, markets are showing signs of optimism following reassuring statements from officials over the weekend.

According to Reuters:
→ Trump announced plans to hold talks with Chinese President Xi Jinping, while the U.S. Trade Representative is set to meet his Chinese counterpart this week.
→ The European Union has taken a conciliatory stance, delaying its initial countermeasures against the U.S. until mid-April.

As a result, sentiment appears to have shifted towards optimism, with the S&P 500 index (US SPX 500 mini on FXOpen) trading approximately 4% above this month’s low.

Technical Analysis of the S&P 500 Index (US SPX 500 mini on FXOpen)

As noted on 17 March:
→ The price is forming an ascending channel (marked in blue).
→ The fact that the price has reached the lower boundary of the channel suggests that bearish momentum may be fading.

Currently, we are witnessing an attempt at a bullish reversal from the channel’s lower boundary.

From a bearish perspective, resistance may emerge around the 5750 level, where the price has previously reacted (as indicated by the arrows).

From a bullish perspective:
→ Bears have lost control of the 5600 level.
→ A bullish gap at the start of the week indicates a significant shift in market sentiment. If positive news continues to emerge throughout the week, the S&P 500 index (US SPX 500 mini on FXOpen) could attempt a rise towards the median of the identified channel.

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