Thursday's Market Minute: Looking Down At Pre-COVID Highs

 S&P 500 futures started off with a bang this week, shattering through the 3400 level and climbing about 2.6% into fresh all-time highs since Monday. As the /ES is now breaking to the upside above the pre-Coronavirus highs, the bullish run in equities may feel somewhat disconnected from reality. Nevertheless, the trend is still pointing to the upside from a technical perspective. One possible concern is the NYSE Advance-Decline Line, which compares the number of rising stocks to falling stocks, is dropping as the /ES continues to forge new record highs. This type of bearish divergence suggests that the rally may not be as strong as it seems from the surface. In terms of resistance, watch for stalls near the 3500 level as well as the Standard Deviation Channel upper line near 3585. To the downside, the confluence of the 21-day EMA, the Parabolic-SAR, and the previous all-time highs suggest a support zone from 3350-3370.