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Analysis of short and long-term trends in the S&P 500 Futures Index

The S&P 500 index (SPX) reproduces the performance of the 500 largest companies listed on American stock exchanges such as the New York Stock Exchange (NYSE) or the Nasdaq. It is also known as the US 500 and considered an indicator of market performance. In this article, find out how to evaluate the short and long term performance of the S&P 500 Futures stock index to better invest.

What is the S&P 500 (SPX)

The S&P 500 is a market capitalization-weighted index of the 500 largest publicly traded companies in the United States. It is also float-adjusted, meaning that the weighting of individual companies is determined by a combination of market capitalization and the number of shares outstanding. It is one of the major indicators of the large-cap American stock market.
S&P 500 index

Analysis of the long-term trend of the S&P 500 price

Analysis of the long-term S&P 500 price trend is done by observing the peaks and troughs on the updated daily charts of the S&P 500 index.

Analyzing higher time frames is very important for your trading decisions. In this way, one must take into account the broader trend that is occurring on the SPX index.

Therefore, it is common to start analyzing the fundamental trend on the daily charts of the Standard and Poors Index, to determine whether the daily trend is bearish or bullish.

Analysis of the short-term trend of the S&P 500 price

The analysis of the short-term trend of the S&P 500 price is done by following the evolution of recent highs and lows on the hourly charts of the S&P 500.

It is equally important to carefully read the current trend of the S&P 500 and perhaps determine whether the following is consistent with the underlying trend of the daily chart.

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You can thus observe the smallest unit of time on the charts where each candle represents 1 hour or 30 minutes on the market. This is the S&P 500 trading period per hour or per minute that you can analyze.
Such analysis allows the investor to evaluate stock market movements, in order to detect the best time to invest. In the case of the S&P 500 index, good knowledge of market developments will allow it to anticipate an increase or decrease in the value of the asset.

S&P 500 Futures Speculations

Speculating or investing in the SP500 CFD is an alternative method, although it is not simpler than the SP500 index futures contract.

Indeed, the SP500 CFD stock market contract allows you to speculate through a trading platform on a large number of products, using leverage. It’s like betting up or down with more than you can afford.

Futures contracts, for their part, are traded in the same way as CFDs in the sense that reading and analyzing prices and decision making process are similar. In both cases, the trader has a significant margin to optimize his profits.

Should you invest in the S&P 500 index?

Since it is widely used in the US large-cap market due to its breadth and depth, any trader may consider trading the S&P 500 Index.

  • This feature also means that technical indicators and trading signals are often highly visible in the market.
  • This makes the indicator more reliable and, in some cases, easier to trade compared to other US stock indices.
  • And because it is extremely liquid, traders will find tight spreads making it easy to enter and exit trades.

In summary, history shows that stock market indices tend to rise, which is why investing in the rising SP500 is a very common topic of discussion among investors. This way of speculating on the market can allow you to invest on the upside as the market continues a healthy, long-term trend. But also, to potentially cushion your losses on the stock market even if the economy slows down.

Disclaimer: Although the S&P 500 index has performed well in the past, this does not influence the results you may obtain in the future. The elements cited in this article are the result of an analysis based on facts.