Market Charts – January 24/22

In our last Trend Letter, we noted that the key support level for the S&P 500 was 4200 and if it hit that level, we could expect a solid rally.  Today, the S&P 500 dropped close to that 4200 level at 4222, before rallying to close the day at 4410.  Watch the 4435 (first red dashed line)  level as initial resistance, which represents at 38% retracement to the early January high.  Investors must be careful as we typically see that after an initial bounce, the low often gets re-tested.

The Fed meeting is on Wednesday and depending on the decision from that meeting there is still room for plenty of volatility. There is still risk of lower lows.

Stay tuned!