S&P 500 Index: Clear break below 3595 to open up further falls to 3235/3195 – Credit Suisse

S&P 500 is expected to see a recovery phase. But an eventual sustained break lower is expected in Q4, with 3235/3195 as the level targeted by the Credit Suisse analyst team.

S&P 500 could enjoy a temporary recovery phase

“Although our broader outlook stays bearish, we continue to look for a temporary recovery phase to emerge for the first part of Q4, especially given bullish momentum divergences. Post this anticipated strength though, we look for a sustained move below 3595 in due course, for a fall to our core target of a cluster of supports at 3235/3195.”

“A triple weekly RSI momentum divergence suggests early Q4 should see a temporary recovery phase.”