Notes from the previous month:

1. Approaching overbought levels
2. Approaching 0.5 resistance at 478.8 (Fibonacci extension)
3. Approaching ATH of 480

Expecting a pullback of about 3-4%, or potentially to 448.

Surprisingly, US stocks remained highly bullish. The SPY pullback was merely 1.4% (17 Jan 2024), after which continued to new all-time highs past 490.

Current SPY level – 494

1. Approaching 0.786 resistance at 496.6 (Fibonacci extension on smaller scale)
2. Approaching 0.618 resistance at 509.7 (Fibonacci extension on larger scale)

Overall market sentiments remain largely positive, so while it is possible that SPY may hover or pull back at 496, it is unlikely to fall substantially. The next target would likely be 500-509.

Another key consideration was the 31 January FOMC meeting, where the Fed signaled that rate cuts were not imminent. Markets are now betting on a rate cut in May or June: