Chart Art: Trend Correction Setups on S&P 500 Index and AUD/JPY

Looking to hop in the risk rallies these days?

I’ve got a couple of trend correction opportunities you might wanna look at!

Check out these support zones being tested.

AUD/JPY: 1-hour

AUD/JPY 1-hour Forex Chart

This pair has been cruising higher inside an ascending channel since the middle of the month!

Another test of support is taking place, and this might determine whether or not the trend is about to carry on.

Technical indicators are hinting at a continuation of the climb, as the 100 SMA is above the 200 SMA. In addition, the 200 SMA dynamic inflection point is adding extra support at the bottom of the channel.

Stochastic is already on the move up to show that buyers are getting back in the game while sellers take a break. The oscillator has plenty of room to head north before reaching the overbought area, too!

In that case, AUD/JPY might be setting its sights back on the channel top around the 96.50 minor psychological mark.

Just be careful since the gap between the moving averages has narrowed to reflect slowing bullish pressure. Better set those stops below the recent lows if you’re planning on going long.

S&P 500 Index (SPX500): 4-hour

S&P 500 Index (SPX500) 4-hour Chart

Aha! Looks like this equity index is in for a reversal from its slide!

The S&P 500 broke above the neckline of the double bottom pattern on its 4-hour time frame and is pulling back for a quick retest.

Will the former resistance hold as support?

The broken neckline coincides with the 50% Fibonacci retracement level and 200 SMA dynamic support, which appear to be keeping losses in check for now.

A larger correction could reach the 61.8% Fib around 3,730 and the 100 SMA dynamic inflection point. This faster-moving SMA is closing in on the 200 SMA, so it might be bracing for a bullish crossover.

Meanwhile, Stochastic has some room to head south before reflecting exhaustion among sellers, so the index could keep following suit.