The S&P 500 rallied yesterday after Al-Arabiya reported that Qatar and Pakistan presented a compromise proposal that could pave the way for an agreement, but the bullish momentum faded after a diplomat involved in the talks subsequently pushed back against reports that a deal was close.Despite the pushback, the market didn’t erase the gains as hopes for a breakthrough before the midterm elections grew given the recent increase in positive headlines. A deal would probably send the S&P 500 to new all-time highs on easing inflation and rate hike concerns, and improving growth prospects. A prolonged stalemate, on the other hand, might keep the upside limited. This week, we have also the US Flash PMIs on Friday. The data will likely be important in light of the growing concerns about the economic outlook. Credit spreads continue to widen, and the Federal Reserve is forced to keep a hawkish bias amid higher inflation, so there are no bullish drivers at the moment. If the data disappoints, growth concerns will likely increase, and we could see another selloff in the S&P 500. Better than expected data, on the other hand, might lead to a relief rally in the short-term but it wouldn’t change the bigger picture as it would just reinforce the need for rate hikes. S&P 500 TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that the S&P 500(CFD contract) is testing the broken trendline. The sellers will likely pile in around these levels, with a defined risk above the trendline, to position for a drop into the 7,500 level, with the 7,613 level as the first target. The buyers, on the other hand, will want to see the price rising back above the trendline to start positioning for a rally into new record highs. S&P 500 TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we have a resistance zone around the 7,760 level. That’s where we can expect the sellers to step in, with a defined risk above the resistance, to position for new lows. The buyers, on the other hand, will look for a break higher to pile in for a rally into new highs.S&P 500 TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, we have a minor upward trendline defining the recent pullback. If the price falls into the trendline, we can expect the buyers to lean on it, with a defined risk below it, to target a break above the resistance. The sellers, on the other hand, will look for a break lower to increase the bearish bets into new lows. The red lines define the average daily range for today. UPCOMING CATALYSTSTomorrow we get the latest US Jobless Claims figures, while on Friday we conclude the week with the US Flash PMIs. This article was written by Giuseppe Dellamotta at investinglive.com.