Chart of the Day - Wednesday, May 7, 2025

🏆  Today's Chart of the Day was shared by Frank Cappelleri (@FrankCappelleri).
 

• Today's price action was relatively muted despite anticipation around the FOMC meeting. The S&P 500 bounced +0.4% after drifting lower over the first two days of the week.
   
• Frank notes that $SPX has formed a potential Bull Flag this week after snapping a historic nine-day winning streak on Monday. Resolving higher from this continuation pattern would signal the start of another advance. 
   
• Today's setup is the mirror opposite of the last FOMC meeting from March 19th, when the index formed a Bear Flag that eventually resolved lower.
   

The Takeaway: The S&P 500 has formed a potential Bull Flag over the past three days, following the end of its longest winning streak in 20 years. A breakout would signal a new leg higher. However, if this bullish pattern fails, it will be a clear warning sign.