S&P 500 Index to plummet towards 4238/33 on a close below 4407 – Credit Suisse

The S&P 500 spotlight turns to its key 63-day average, which has essentially held every setback this year, now at 4407. A sustained close below here would warn of a more significant but still corrective move lower with support seen next at the 4368 August low and potentially 4238/33, the Credit Suisse analyst team reports.

VIX to rise towards 28.93 on a  close above the top of the three-month range at 24.74 

“A sustained close below the rising 63-day average, now seen at 4407 would warn of a more concerted phase of corrective weakness and a test of the 4368 August low. Below this latter level we would see scope to test 4238/33.” 

“Resistance moves to 4449 initially, with the immediate risk now seen staying lower whilst below 4476/87.” 

“The VIX has gapped sharply higher following the close above its key 200-day average and a close above the top of the three-month range at 24.74 would warn of a further rise in volatility to 28.93 next.”