First Support for the S&P 500

“Volume Profile” and Fibonacci retracements estimates  the first S&P 500 (SPX) support zone.

“Volume Profile” analysis has volume on a vertical scale and matches the volume with price action.  The largest volume cluster is called “Point of Control” (POC) which could be support/resistance for price. 

The daily SPX chart courtesy of Trading View illustrates the action since the October 2023 bottom.

Using “Volume Profile on the SPX – 10/27/23 to 12/28/23 rally shows POC at 4,550.00.  Note that the heaviest volume corresponds to the sideways price action from 11/20/23 to 12/08/23.

The POC is close to a Fibonacci .382 retracement of the 10/27/23 to 12/28/23 rally.  The Fibonacci .382 retracement is at SPX 4,529.00, the broad support zone is 4.520.00 to 4,565.00.

If the SPX appears to find support in this zone, the Dow Jones Industrial Average (DJI) could provide supporting evidence of a potential bottom.

As of 01/04/24 the SPX was down 2% from its late 2023 high.  The DJI from its early 2024 top is down only 1%.  If the DJI continues to decline slower than the SPX it could be a hint that the overall drop in U.S stocks lacks strength.