S&P 500 Holds at 6692 Ahead of Fed Signals – Outlook and Trading Scenarios

Investor attention remains focused on the Federal Reserve and the prospects of further rate cuts. According to CME Group’s FedWatch Tool, markets currently assign an 89.8% probability of a 25 bps cut at the late October meeting. However, comments from Fed officials yesterday were less dovish than expected. Raphael Bostic, President of the Atlanta Fed, stressed that the central bank must stay focused on returning inflation to the 2.0% target, which requires maintaining relatively high interest rates. St. Louis Fed President Alberto Musalem echoed this cautious stance, warning against rushing into easing. The only official advocating faster cuts was Stephen Miran, a White House appointee, who argued current policy risks undermining labor market stability.

Bond yields continue to trend higher: the 10-year yield rose from 4.105% last week to 4.141%, the 20-year from 4.686% to 4.732%, and the 30-year from 4.734% to 4.764%.

Among index leaders were Teradyne Inc. (+12.79%), Oracle Corp. (+6.31%), Applied Materials Inc. (+5.48%), and Western Digital Corp. (+5.42%). On the downside, Kenvue Inc. (–7.47%), Match Group Inc. (–5.40%), and Keurig Dr Pepper Inc. (–4.28%) led the losses.

Support and Resistance Levels

The index is consolidating within an overall uptrend on the daily chart, once again attempting to surpass the yearly high of 6700.0. Technical indicators are maintaining a strong buy signal following the end of a local correction: fast EMAs on the Alligator indicator remain above the signal line, and the AO histogram in the buy zone continues to form corrective bars.

Support levels: 6600.0, 6350.0.

Resistance levels: 6770.0, 6990.0.

S&P 500 Trading Scenarios and Outlook

If the price breaks and consolidates above 6770.0, long positions targeting 6990.0 become relevant. Stop-loss — 6660.0. Implementation timeframe: 7+ days.

If the price declines and holds below 6600.0, short positions targeting 6350.0 come into play. Stop-loss — 6700.0.