The S&P 500 index is facing significant challenges and is on the verge of a critical technical shift. This situation has arisen in the wake of President Donald Trump implementing the highest tariffs seen in a century, raising considerable concerns among both traders and investors.

Current Market Situation

Recent data indicates that the index dropped more than 3% at the market's open. The S&P 500 is now hovering around a correction level of approximately 5500 points. Technical analysts emphasize the importance of this threshold:

• If the index remains below 5500 points, it may signal the onset of a long-term bearish trend;

• The 5500-point level is regarded as psychologically significant, potentially attracting buyers looking for dips.

Traders' Expectations and Projections

Wall Street professionals had anticipated a "Trump proposal", expecting the president might step in to stabilize the stock market. Instead, he triggered a sharp sell-off, leading to increased volatility in the market.

Key Levels to Watch

Traders are monitoring the following levels, which could serve as indicators for future movements:

1. Support level at 5400 points;

2. Support level at 5200 points;

3. Support level at 5000 points.

Keeping an eye on these levels is crucial for assessing the short-term outlook of the index.

Economic Instability and Its Impact

Current technical and economic forecasts remain uncertain. Amid heightened volatility, traders are closely observing not just price movements, but also overall investor sentiment. It is important to note that changes in tariff policies can significantly affect the following sectors:

• Companies reliant on imports;

• Manufacturers operating in international markets;

• Financial institutions providing services to companies impacted by new tariffs.

In light of recent developments, the S&P 500 index finds itself in a challenging position where its future will depend on various factors. Technical levels and traders' responses to changes in external policies will dictate price movements and market conditions in the short term. Given the instability exacerbated by the introduction of new tariffs, it is crucial for investors to stay alert to trends to adapt to these emerging challenges.