S&P 500: The Big Picture

Hello and welcome to our big picture analysis of the S&P 500. We’re starting here by looking at the monthly and weekly candle charts.

We begin with the long-term trend from 2008 to today. We’re in a very clean rising trend channel, which gives us a good sense of the overall structure. To better understand the significance of certain price levels, we’ve highlighted areas on the chart: green, red, and gray shaded zones acting as trend lines.

The green shaded area represents support, found at the bottom of the trend channel. The red shaded area marks resistance, at the top. The gray shaded area runs through the middle of the channel, often acting as a balance point or intermediate support/resistance.

Market Shows Signs of Deceleration After Extended Upward Rally

The weekly chart presents a compelling technical picture as market momentum begins to show signs of exhaustion. Within the same long-term trend channel that originated from the 2009 low, we observe the familiar green, red, and gray shaded zones that have guided price action for over a decade. The left portion of the chart clearly shows the 2022 market top followed by the subsequent low, where the green shaded area provided exceptional support during that critical period.

From that foundational low, prices embarked on a sustained rally toward the February 2025 high, consistently respecting the gray shaded area as both resistance and support throughout the entire move. However, a sharp correction materialized in April, once again finding robust support precisely at the green shaded area, demonstrating the reliability of these technical levels.

Following that April bounce, prices managed to pierce through the gray shaded area again, but the move upwards has now slowed considerably, with the most recent weekly candle displaying sideways to upward movement. This deceleration in momentum suggests that the market may be preparing for a more substantial pullback.

Based on this technical development, we anticipate prices will likely retreat and potentially find support within the gray shaded area once more. The weekly chart also reveals an additional, shorter-term trend channel that begins from the 2022 low, creating a more refined analytical framework. Within this condensed channel, we again observe a gray shaded area where prices were recently rejected, and despite rising slowly upward along this zone, they have encountered rejection again this week, as marked by the red circle on the chart.

This shorter-term trend channel maintains its own green shaded support area, which remarkably aligns with the gray shaded area from the longer-term trend channel that has been in place since 2009. At the precise intersection where the green support of the short-term channel meets the gray midline of the long-term channel, we have identified a confluence zone of exceptional significance for potential price reaction.

This convergence creates a fascinating technical setup that serves as a simultaneous test of the long-term trend’s balance zone and the support line of the short-term trend channel. The dual nature of this confluence makes it a particularly compelling level to monitor closely, as it represents the intersection of multiple timeframes and technical structures that have proven their reliability over extended periods.