Potential Swing Entries Developing

After a sharp pullback, both the S&P 500 (SPX) and Nasdaq 100 (NDX) are showing early signs of stabilization. Positive divergences have emerged on the RSI and PPO indicators, suggesting momentum loss in the downtrend. Additionally, both indices have bounced off their 100-day moving averages, a critical support level that could offer objective swing trade entries for traders looking to position long.

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📌 Technical Breakdown: S&P 500 (SPX) & Nasdaq 100 (NDX)

1. Positive Divergences Signaling Potential Reversal

Both RSI and PPO are forming higher lows, while price action made lower lows—a classic bullish divergence that indicates selling momentum is weakening.

• RSI Holding Above Oversold Levels: Suggests buyers are stepping in earlier.
• PPO Histogram Turning Up: Signals potential bullish momentum shift.

2. 100-Day Moving Average Bounce

Both indices tested and held their 100-day MAs, a key trend-following support level.

• SPX bounced near 5,926
• NDX found support around 20,869

Holding these levels increases the probability of a near-term relief rally or a full reversal back to prior highs.

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📌 Trade Setup & Risk Management

🔹 Bullish Trade Idea

• Entry Zone: Look for confirmation above intraday highs.
• Stop Loss: Below recent swing lows to limit downside risk.
• Target Levels:
  • SPX: 6,056, 6,101, and new highs above 6,137
  • NDX: 21,466, 21,830, and 22,084 resistance

🔹 Risk Considerations

• If price breaks below the 100-day MA, it could lead to further downside pressure.
• Upcoming economic data and Fed commentary could add volatility.

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📌 Final Thoughts

The combination of bullish divergence + key moving average support makes this an attractive swing trade setup for traders looking to catch the next upside move. While confirmation is still needed, holding above these support levels could fuel a bounce in the coming days.

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