S&P 500 (SPY) Rebounds After Testing New Lows

As Treasury Yields decline, the S&P 500 increases

As traders hurried to purchase equities after the sharp decline, the S&P 500 resumed upward momentum after touching new lows at 3570.

Stocks received extra support when the yield on 10-year Treasuries dropped below 3.90% and failed to settle above that mark.

Despite the widespread recovery, it is important to highlight that semiconductor stock prices are still in decline. As traders respond to the current export limitations placed on China, shares of Qualcomm, Qorvo, ON Semiconductor, and other companies in this market category are heading down.

In spite of today's wide stock market recovery, Meta and NVIDIA were able to escape their annual lows while testing new lows.

Looking at the larger picture, today's bounce seems technical. In just four trading sessions, the S&P 500 went from the 3800 level to 3575, so it's not unexpected to find that some traders were prepared to purchase equities at a significant discount to recent levels.

Earnings season will soon put the market to the test. At the end of this week, major banks including JP Morgan Chase, Wells Fargo, Citigroup, and Morgan Stanley will report their earnings, and the market's attitude will be greatly impacted by their statements. Ahead of these crucial news, trading may remain volatile.

S&P 500 Examines 3640 as Resistance

The S&P 500 managed to regain control above 3615 and is now attempting to hold above the next resistance level at 3640. If successful, it will go in the direction of the resistance at 3675. The S&P 500 will be pushed toward the 3700 level if a move is made over the 3675 level of resistance.

The S&P 500's closest support level is at 3615 on the support side. The next support level, at 3585, will be reached if the S&P 500 drops below this level. If the support at 3585 is successfully tested, the S&P 500 will move closer to the next support level at 3560.