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This week, the S&P 500 (SPX) has remained relatively flat, with minimal gains and price consolidation around previous resistance levels. Both supply and demand have decreased, but important patterns are emerging.

Key Insights

• Decreasing Supply and Demand: While both supply and demand have dropped, the balance of power currently favors the bulls. However, we need to watch for demand exhaustion, which could signal a shift.

• Potential Pullback: If we see an increase in supply, a pullback or further consolidation is likely. But this could also serve as a healthy pause for the next breakout.

• Bearish Rejection Attempt: There was an effort by bears to push prices down, seen in the rejection tail and bearish bar. However, the supply behind the move wasn’t strong, and it quickly reversed like the previous week.

Impact of Powell’s Speech

• Demand Spikes: Powell's comments triggered a bullish response. On the hourly chart, a demand tail emerged, followed by a bullish bar, confirming potential upward movement.

• Confirmation of Bullish Momentum: The breakout bar after Powell’s speech indicates the bulls still have the upper hand. As long as supply remains low, expect further upward movement until a significant supply spike occurs.

What to Watch Next

• Supply Spikes: Keep an eye on any sudden increase in supply, which could indicate a pullback.

• Individual Trade Setups: Focus on specific setups in the current market, which we’ll dive deeper into in future analysis.

Wyckoff Method Analysis in the S&P 500

Watch the video below to find out:

• Why a bearish rejection tail might not always signal a major sell-off.
• What to watch for regarding supply spikes and demand exhaustion to anticipate the next big market move.
• How the low volume consolidation could affect the S&P 500.

Video Length: 00:01:43

In summary, the bulls are still in control, but market watchers should stay vigilant for signs of demand exhaustion or supply spikes that could trigger a shift.

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