Insights 
VT 
Key Points:
- S&P 500 closed at 5639.73, recovering from an intraday low of 5586.4 after rebounding sharply post-Asia session.
- U.S.–China officials will meet in Geneva over the weekend to outline the next steps in trade talks.
Global equity markets extended a cautious rebound Tuesday, with the S&P 500 ticking higher amid investor focus on two pivotal events: the weekend trade dialogue between the U.S. and China, and Wednesday’s Fed meeting. The index closed at 5639.73, reversing earlier declines from a low of 5586.4, as technical support near that level held firm.
Risk sentiment was tempered by mixed commentary ahead of the U.S.–China Geneva meeting. Treasury Secretary Scott Bessent described it as “about working out what to talk about,” while Beijing responded coolly, warning the U.S. not to mistake dialogue for compliance. Despite the guarded tone, futures held gains through Asia, and the rebound in Hong Kong equities helped anchor global risk appetite.
Markets also found modest support from China’s fresh policy signals. Beijing hinted at interest rate cuts and expanded the scope for insurers to invest in equities, though investors remain wary given the absence of direct fiscal stimulus. For now, these measures are more palliative than potent.
Attention now turns to the Federal Reserve’s upcoming policy decision. No rate changes are expected, but traders are watching closely for any dovish signals—especially after recent U.S. jobs data pointed to a labour market that remains resilient. That strength has caused markets to slightly dial back their expectations of rate cuts later this year.
Technical Analysis
The S&P 500 saw a volatile session with sharp directional swings, opening at 5592.55 and briefly dipping to an intraday low of 5586.4 before mounting a strong recovery. That rally, however, met resistance near 5670.47, capping further upside as profit-taking kicked in. Price has since settled into a consolidative range between 5620 and 5665, with momentum softening.
Short-term moving averages (5, 10, 30) show signs of compression after a bullish crossover, but the upward slope has begun to flatten, indicating a stall in trend strength. The price is hovering just above the 30-period MA, hinting that buyers are still attempting to defend near-term support.
Picture: SP500 rebounds from 5586 low, hits 5670 peak before stalling, as seen on the VT Markets app
On the MACD front, the recent bullish crossover remains intact, but histogram bars are shortening, reflecting cooling bullish momentum. The move above 5640 marks an attempt to reclaim higher ground, but a failure to break past 5670 decisively keeps the index vulnerable to another pullback—particularly if 5610–5585 fails to hold.
If bulls can reclaim 5670.47 with conviction, upside momentum may reaccelerate toward 5685–5700. However, a break below 5585 could invite renewed selling pressure, dragging price back toward previous range lows.
Cautious Forecast
If the Geneva trade talks show signs of structure or sincerity, we may see the S&P 500 challenge resistance near 5686.55 again. However, mixed signals from central banks and simmering geopolitical risks could cap gains in the near term. Short-term consolidation around the 5630–5660 range looks likely unless strong catalysts emerge.
