S&P 500 Forecast – S&P 500 Gaps Lower to Kick Off the Week

US Stock Market Forecast Video for 10.10.23

S&P 500 Technical Analysis

The S&P 500 gapped lower to kickoff the trading week on the wrong foot, as the world reacts to the invasion of Israel. That being said, it does look like the market has stabilized a bit since then so it will be interesting to see all this plays out. If we can take out the top of the candlestick from the Friday session that would obviously be a very bullish sign, and could send this market ripping higher. In that environment, I would not be surprised at all to see the S&P 500 go running toward the 4500 level, possibly even reaching the all-time highs yet again.

Underneath, we have the 200-Day EMA and the 50% Fibonacci level both offer a bit of support, so we’ll have to wait and see how that plays out. I think at this point, it’s obvious that the market at least wants to try to recover, but whether or not it has the appropriate momentum is a completely different question altogether. At the moment, when I look at this chart it seems like more than anything else, it’s looking to stabilize.

Again, that would make a certain amount of sense considering that the 200-Day EMA indicators are quite often something that a lot of longer-term traders pay close attention to, and therefore it’s probably only a matter of time before somebody steps in and tries to pick up the market. Because of this, I think you need to pay close attention to those highs on Friday, because that will give you a good indicator as to whether or not the market is going to shrug off all of this bad news, and simply rally.

On the other hand, if we break down below the lows of last week, that opens up a move down to the 61.8% Fibonacci level, and then possibly even the 4100 level. It would not surprise me at all to see either one of these scenarios play out, because you can make an argument for both. Quite frankly, most of this is going to come down to the interest rates in the United States, which, by the way, the bond market was closed on Monday so that might give the market a little bit of a reprieve.

For a look at all of today’s economic events, check out our economic calendar.