The S&P 500 closes higher but pulls away from its best levels

• Indices move higher but pulled away from session highs after sentiment turned slightly.
• Its been a good session all round in the equity markets as Asia, Europe and the US closed higher.

Fundamental news

Equities are trading higher after fresh support was announced by the Bank of Japan and the Fed yesterday. There was also some good news on the coronavirus front as results of the steroid Dexamethasone drug in Covid-19 patients showed it reduces deaths by up to one third in hospitalised patients with severe disease. 

On the negative side, Texas coronavirus cases rose 2.9% above the 7-day average. Florida is also struggling as the case count there moved 3.6% higher vs the 7 day average of 2.5%. New York, however, has improved with a 0.2% rise. 

On the macro front, China and India have also been at odds with each other with some conflict at the border. Indian officials also confirmed 20 soldiers died during the fracas.

At the end of trading Tuesday, the Dow traded up 1.63% to 26383.09 while the NASDAQ rose 1.55% to 9916.55. The S&P also rose, gaining 1.59% to 3134.59.

In terms of data, U.S. retail sales surged 17.7% in May, after falling 14.7% in April. However, analysts were expecting an 8% increase.

S&P 500 4-hour chart

The chart below shows the trendline break and retest on the 4-hour chart. Tomorrow will be very interesting as on a technical level the price could move lower but sentiment still remains firm. The psychological 3000 level is still important and if there is a sell-off it should be watched carefully. 

On the downside, a lower low lower high would be created if 2963.50 is broken. This could be a technical signal for a trend change along with the trendline break. Elsewhere, the 55 and 200 moving averages are also underneath the price. They both could be potential support zones if any bearishness kicks in.

Additional levels