SP 500 Renko Chart Trading and Technical Analysis 10/04/21

Overview

Renko Chart Trading

As feared, 4,380 proved to be an insurmountable barrier, and 4,356 was unable to halt the descent. The S&P 500 index has recovered after briefly falling below the psychological barrier of 4,300. The $SPX ended the day in the red, closing near the psychological level of 4,300. The $SPX failed to reach the 4,260 support level. However, it did receive some support in the 4,278 area. According to Renko chart trading patterns and technical analysis, the $SPX is still correcting downward in order to locate a firm support level that will attract buyers. As a result, opening a new long position at this time would be a bad decision. $SPX must first find a bottom before it can climb higher. The declining trend does not appear to be over.

$SPX has now fallen below the three main support levels of 4,380, 4,356, and 4,320 for the second time. The declining trend persisted. There may be modest advances in between the dips as shorts take their profits or speculators seek to acquire equities to profit from the small and quick gains. A short-term bottom has yet to materialize as the market continues to sort out its course. For the bulls, things aren’t looking good. As long as the down trend continues, today’s low, 4,278, might not be the bottom. $SPX might retest the 4,278 area or fall even lower to 4,260.

Writing Covered Calls

Because there are so many unknown variables right now, taking a new long position should be done with prudence. For the time being, writing covered calls on stocks you own to give downside protection is a sensible option if you haven’t taken profits on your long positions. In a downtrending market, on the other hand, writing covered calls could be a profitable move. For the time being, the best strategy to deal with the market is to invest cautiously or stay on the sidelines.

  • The traditional 6-point brick size is used in the Renko chart.
  • On the upside, the 4,320 region serves as an immediate resistance level, followed by the 4,356 resistance level.
  • On the downside, 4,260 is the first level of support, followed by 4,230, and subsequently 4,200.

How to Apply Renko Chart Trading Patterns and Technical Analysis in Trading – Support, Resistance, and Trendline

The bulls face hurdles, according to the daily Renko chart pattern and technical analysis, because the $SPX has resumed its downside decline. Despite today’s slump, the market’s future path remains unknown. To begin with, it’s uncertain whether the market has reached a short-term bottom. Second, it momentarily fell below the psychological level of 4,300, but managed to close at that level today, indicating market jitters. If the $SPX can test and rebound off of the 4,260 level, the near-term outlook may look a little brighter. If the downward trend continues, the market will very certainly fall to 4,200.

Daily Renko Chart

SP 500 Renko Chart Trading and Technical Analysis 10/04/21 daily chart

The $SPX is clearly below the preceding important support levels of 4,380, 4,356, and 4,320 on the hourly Renko chart. As the $SPX has broken through numerous critical support levels, the bulls’ situation has gotten worse. For the time being, the spotlight will be on 4,260, which gives bulls much-needed support. If 4,260 does not hold, the collapse will continue. The initial support level below 4,260 is at 4,230, followed by the previous low of 4,200. To the upside, $SPX needs to reclaim the 4,320 level, then the 4,356–4,380 range.

Hourly Renko Chart

SP 500 Renko Chart Trading and Technical Analysis 10/04/21 hourly chart

4,356 is currently a significant resistance level on the 5-minute Renko chart, pushing the $SPX down. The market is clearly still looking for a bottom. It’s unclear whether the 4,260 level of support will be sufficient to stem the downward trend. If the price falls below 4,260, it will initially fall to 4,230. If this continues, the price will fall to 4,200. On the 5-minute chart, the bulls’ prospects appear bleak. The 4,320 and 4,356 levels must be recaptured on the upside in order to continue higher and retest the 4,380 zone.

5-Minute Renko Chart

SP 500 Renko Chart Trading and Technical Analysis 10/04/21 5-minute chart

Renko Chart Trading: More Resources

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