S&P 500 Price Forecast August 1, 2017, Technical Analysis

The S&P 500 initially rally during the day on Monday, but found the 2475 region to be a bit too resistive to continue. We pulled back significantly, but I think there is plenty of support just underneath. The market will continue to be very volatile though, because quite frankly this is a market that continues to show a significant amount of choppiness as many traders I speak to are very concerned about these high levels. Having said that, I think we will see buyers return though, as we continue to in general. With this, it could be a short-term buying opportunity, but I would not be a long-term holder of this market unless you can trade a very small position.

Buying dips still

I believe in buying dips still, although I’m not looking for explosive moves anymore, just simple waves to the upside. I have no interest in shorting, least not until we break down below the 2400 level, which is significantly lower than we have reached. Because of this, this is essentially a “buy on the dips” situation, and that’s about it. Given enough time, I would anticipate that the market feels it needs to reach towards the 2500 level above. That’s an area that should be massively resistive though, and therefore I don’t think we can break above there on the initial attempt. If we did break above the 2500 level, I believe that the market would become more of a “buy-and-hold” situation. Volatility should continue, so keep your trading position small, and be quick to take profits if you are involved in the S&P 500 over the next couple of sessions. If we did breakdown below 2400, that would be catastrophic that we are at least several days away from that happening.

S&P 500 Video 01.8.17