FXStreet reports that the S&P 500 Index has pushed to a new record high closing at 3722. With momentum not confirming the new highs and with the market seen in a “euphoric” state, analysts at Credit Suisse look for the 3720/25 area to cap at first. Indeed, the contributors have growing concerns the market may be close to seeing a more concerted pullback/correction. 

“The S&P 500 has pushed to a new record high to our 3720/25 next objective, which is capping for now as expected. With the market seen in a ‘euphoric’ state (90% S&P 500 stocks are above their 200-day average) and with daily MACD momentum also turning lower and daily RSI momentum not confirming the new highs, the market is seen in an increasingly vulnerable state, with the threat of a correction lower seen growing steadily.” 

“Support at 3691/86 holding can keep the immediate risk higher for now and post some near-term consolidation above 3725 can see strength extend to a cluster of what we expect to be tougher resistances in the 3765/85 zone, from which we will then look for a more concerted effort to see a correction.”