As long as the price of the Vanguard 500 is above $300, this ETF will remain in the bull market
The US reported over 130,000 new cases in one day, and the pandemic brought US hospitals to the brink of capacity
If the price falls below $300, this would be a strong “sell” signal and we have the open path to $290.
It is expected that the Vanguard S&P 500 ETF will continue to receive long-term support and may even move up in November of this year if the global situation stabilizes. Pharmaceutical company Pfizer announced that it may have a coronavirus vaccine ready in the United States by the end of this year.
Fundamental analysis: Vanguard 500 is expected to continue to be supported in the long term
Vanguard follows the S&P 500 and enjoys an excellent reputation among everyday investors who like its low-cost funds. Buying this fund gives you exposure to 500 of the largest listed companies in the United States, and it is important to note that Warren Buffet recommends this ETF.
It is therefore important to note that the price of the Vanguard 500 is correlated with the S&P 500 and that investors in this ETF should also have the S&P 500 on their “watch list”. The S&P 500 is trading above 3,500 points and some analysts believe that the S&P 500 could trade even higher in the coming days.
Last week, the U.S. stock indices recorded the best weekly percentage gains since the week that ended on April 10th. This week the Dow Jones gained 6.9%, the S&P 500 7.3% and the Nasdaq 9%, the fifth consecutive gain. The Vanguard S&P 500 ETF is also supported by the fact that Pfizer and BioNTech announced that their jointly developed COVID-19 vaccine is effective in more than 90% of patients.
The U.S. stock market is supported by the optimistic prospect of a split Congress and reduced risk of major political changes. Joe Biden won the presidential election in his native Pennsylvania last Saturday and became the 46th President of the United States.
On the other hand, concerns about sluggish economic growth amidst the ongoing pandemic continue to dominate financial markets. The US reported more than 130,000 new cases in one day, and the pandemic brought US hospitals to the brink of capacity.
There are some obvious risks involved in trading the Vanguard 500 ETF, but as long as the Vanguard 500 price is above $300, this ETF will remain in the bull market.
Technical analysis: Bulls focus on breaking the resistance level at $340
As long as the price of the Vanguard 500 remains above $300, this ETF remains in the “buy” range and there are no signs of a trend reversal.
Data source: tradingview.com
On this diagram I have marked important resistance and support levels. The important support levels are $300, $290 and $280, $340 and $350 represent the resistance levels. If the price jumps above $340, it would be a signal to buy Vanguard 500 and we have the open path to $350.
A rise above $350 supports the continuation of the uptrend and the next price target could be around $360. On the other hand, it would be a strong “sell” signal when the price drops below $300 and we have the open path to $290.
Summary
Vanguard follows the S&P 500 and charges a cost ratio of only 0.03%, which is very favorable. The price of the Vanguard 500 is correlated with the S&P 500 and investors in this ETF should also have the S&P 500 on their “watch list”. The S&P 500 is still in a bull market and some analysts believe that the S&P 500 could trade even higher in the coming days. There are some obvious risks when trading the Vanguard 500 ETF, but as long as the Vanguard 500 price is above $300, the ETF will remain in a bull market.
