Trading plan for SPX500 for December 31, 2020

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Technical outlook:

SPX500 might have carved a meaningful top just above the 3,759 level, or it is very close to forming a top soon. The indice futures is seen to be trading around the 3,734 level at the momen tof writing the article. It might be preparing to continue drifting lower from here.

Immediate price resistance is seen towards 3,760 while support comes in around the 3,600 level respectively. A break below 3,600 would certainly confirm that SPX500 has carved a meaningful top and that bears are back in control. The indice has been in a religious uptrend since March 2020. Then, it reached lows around the 2,200 level and managed to carve a series of higher highs and higher lows through the 3,759 high.

The overall uptrend looks to be mature and bears might be preparing for a meaningful corrective drop towards the 3,200 and 2,800 levels respectively over the next several weeks. A break below 1,3230 will confirm that a much deeper correction is due.

Trading plan:

Remain short, stop is above 3,800, target is 3,200 and 2,800.

Good luck!

The material has been provided by InstaForex Company - www.instaforex.com