US equity markets rose to new all-time highs last week, cheering on the new administration.
The S&P500 Index settled at 3839 on Friday, closing a tad lower after rising to 3868 on Thursday.
The VIX index continues to remain around the level of 20, suggesting further upside is likely to prevail. And on a weekly basis, the S&P500 recovered all the losses from the previous week.
Overall, price action is somewhat flat over the last three weekly sessions.
The trendline is starting to get steeper, which could see a possible breakdown lower. With no retracement to establish support forming yet, the equity index is at risk of a pullback.
The initial support remains at the 3674 handle, marking the highs from 9th November.
Below this level, we have the 31st August highs near 3588 as well. Therefore, a pullback could see the equity index establishing support near these levels in the short term.
With the volatility index currently low, however, there is further scope for the S&P500 to rise with the downside limited at the moment.
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