Spoofed by drop in crude oil prices and a slump in Chinese stock market, broader US equity indices futures were trading lower before recovering, pointing to a higher open on Wednesday.
Oil slides, Chinese equities slumped
Earlier on Wednesday, oil prices fell over 2% on announcement that Kuwait oil workers had called-off their strike. This coupled with a slump in Chinese equity markets dragged the broader US equity index, S&P 500, lower.
Bullish momentum to continue
The index future has managed to recover from lows to trade above the very important 2100 mark. The index is now within striking distance of scaling back to the all time high level of 2136.90 touched in May 2015.
From current levels, move above Dec. 2015 high of 2106.10 is likely to confront resistance near 2116.50 (Nov. 2015 high). Strength above Nov. 2015 seems to pave way for a retest of all-time high levels resistance near 2135-37 area. A follow through buying interest is likely to extend the bullish momentum in the near-term.
On the downside, 2090 level seems to have emerged as immediate support, which if broken should continue to drag the index lower towards its next major support near 2070 region. Only if the index fails to hold 2070 support, prospects of near-term bullish momentum gets negated.