Technical Analysis – US 100 index celebrates Biden’s presidency at a fresh record high

Christina Parthenidou, XM Investment Research Desk

The US 100 stock index (cash) popped to a fresh record high of 13,397 in the first day of Joe Biden’s presidency after finding a strong footing around the red Tenkan-sen line.

With the RSI approaching its former peaks around the 70 overbought mark and the price hovering around the 161.8% Fibonacci extension of its latest pullback at 13,368, a downside reversal towards the swing high of 13,126 and the red Tenkan-sen line is likely in the near-term. The 20-day simple moving average (SMA) at 12,900 will be closely watched ahead of the 12,660 support area and the 50-day SMA at 12,520 if sellers keep the upper hand. The next negative correction may cease near the restrictive region of 12,180.

If the rally continues, the 261.8% Fibonacci extension of 13,760 may add some pressure before all eyes turn to the 14,000 psychological number.

In brief, the bullish action in the US 100 index could run out of steam in the short term if the 13,368 barrier holds firm. Otherwise, the market may seek fresh highs around 13,760.