S&P tests key level after a big drop on coronavirus concerns

Earlier we reported that the markets fell sharply amid growing concerns over the spread of the virus hurting economic growth. At one stage the Dow was down in excess of 1000 points! But as I write this, the markets are coming off their worst levels. Have we hit a low, or is this a temporary respite after vicious falls through the session?

Source: TradingView

From a technical point of view, keep a close eye on the 3216 level – the prior swing low. At the time of writing, the index was rebounding after a brief break below it. Is this a potential swing failure bullish reversal pattern in the making? It would be if the markets hold above it.

However, all bullish bets would be off again should we go and hold below this level. If this turns out to be the case, the bulls would have to remain extremely careful for the markets could continue to bleed lower for a while yet.

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