S&P 500 Index Price Forecast November 16, 2017, Technical Analysis

The S&P 500 drifted lower initially during the trading session on Wednesday and then eventually fell rather steeply towards the 2555 level. However, we have bounced significantly since then, as algorithmic trading comes back into play. The question now is whether we can break above the 2575 handle. When I look at this chart, I noticed that the 24-hour exponential moving average is starting to turn lower, and of course, at the beginning of the 24-hour session, we had seen the stochastic oscillator start to cross in the overbought section. I think that this signifies that we will eventually drift lower, and at that point go looking for more significant support at perhaps the 2550 handle. Quite frankly, the S&P 500 desperately needs to find value underneath, as we have gotten a bit ahead of ourselves on the longer-term charts. Ultimately, this market will continue to be very volatile, so keep your position size small if you can.

S&P 500 Video 16.11.17

If we are to break down below the 2550 handle, the market should then come down to the 2525 level underneath, and then eventually the 2500 level. Longer-term, I am still a buyer, but I also recognize that we need to do some work to continue to build up the momentum. Eventually, I believe that the market can break above the 2600 level, but it is going to take quite a bit of volatile action and momentum building to finally have that happen. I think that a selloff in the S&P 500 is extraordinarily important, as it gives us an idea of value, which has been missing in this market for quite a while. The markets continue to be noisy, so keep that in mind. I am very cautious about shorting this market.