Technically Speaking – May

June 3, 2025

Technically Speaking:

Long-term Resistance: SP500  6150

Long – Term Support: SP500  5215 then 4635

Markets continued to be volatile during May but ended the month strongly. The strength came from investors becoming more optimistic about the trade talks with China. It still seems like it might be some time until that trade deal is solidified, but there has been progress made. The S&P rallied over 6% during May and is up over 20% from the lows in April. The S&P is still trading at about 3.5% below its all-time high and the long-term resistance remains at 6,150. I think we can see a breakthrough in that resistance by the end of the year if the positive trade talk momentum continues. If trade talks break down and the market sentiment turns more negative, then we could see the S&P test its long-term support level of 5,215. If the S&P falls below that level, then we could see the S&P drop to 4,635 before finding more long-term support.

Inflation came in lower than expected for April, which means we could see rate cuts coming sooner rather than later. But for the time being, with money markets still paying around 4% annual interest, we can be patient and look for opportunities in the market volatility. We will remain buyers through the volatility as trade talks continue to be positive.