S&P 500 Technical Analysis
The S&P 500 has gapped lower to kick off the trading session on Monday, showing signs of negativity. However, we have seen the market turn right back around and it looks as if we are threatening the 50-Day EMA, and then perhaps the 3800 level. Ultimately, this is a market that should continue to be very noisy, but quite frankly it’s difficult to imagine how the market is going to slow down with the choppy behavior. The more, the 50-Day EMA above will cause some issues, but on the other hand, if we continue to see a lot of concerns about the economy and of course the Federal Reserve tightening monetary policy, it’s difficult to imagine that the stock market will rally from there.
On the other hand, if we break down below the lows of the last couple of days, that could send this market down to the 3600 level. The 3600 level has been a significant amount of support, and it could make a nice target for those who are bearish. On the other hand, if we turn around and take off above the 3925 level, then it opens up the possibility of a move to the 4000 level, where the 200-Day EMA currently is trying to get down to.
The 200-Day EMA of course offers a lot of psychological resistance as well, so that could possibly come into the picture and could kick off quite a bit of exhaustive move. Overall, I think this is a market that continues to see a lot of back-and-forth, so be cautious about your position size as it could get you into a lot of trouble.
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