S&P 500 has fallen below the previous bottom, 3636 but trying to hold just below it, at the 3575 support. Strong jobs report and incoming CPI data are causing fear that FED will continue to be hawkish. IMF and World Bank recently warned of an incoming recession next year.
From the technical standpoint, S&P 500 is close to the lower line of the trend channel while RMI is close to giving a buy signal. Even if the 3575 breaks to the downside, the 3400-3475 zone could become a major support for a possible direction change, targeting the upper line of the trend channel. Of course, a buy signal has not occurred yet and bearish pressure is still too high. Wednesday’s FOMC minutes and Thursday’s CPI data will be the main drivers for the short-term outlook.