S&P 500 Price Forecast August 3, 2017, Technical Analysis

The S&P 500 had an interesting day on Wednesday, as we went sideways initially but then sold off rather drastically when the Americans came to work. Ultimately, I believe that the algorithmic trading continues to lift this market, and therefore I think that these dips have been offering nice buying opportunities, and until they fail, it’s going to work out as a stringent trading strategy. After the significant drop, we tend to try and walk back a lot of the losses. I suspect that black box algorithms are getting involved based upon a reversion to the meantime of strategy.

2450

I believe that the 2450 level is significant, and as long as we can stay above there, there’s probably going to be buying from algorithmic traders on these dips. I think that the market is still going to try to reach towards the 2500 level, which of course is a large, round, psychologically significant number. If we can break above there, the market should be more of a “buy-and-hold” situation. However, I think that this market continues to be a market that gives us an opportunity in the short term to start buying in picking up value as it continues to show itself. If we did breakdown below the 2450 handle, I feel at that point we would probably continue to drift towards the 2400 level. This is a market that’s been in a longer-term uptrend for some time, and I think that continues to influence the market. The choppiness that we’ve seen lately should end up helping the move to the upside, as it gives us an opportunity to burn off some of the over exuberance that we have seen in the market. I remain bullish, especially considering that earnings season has been relatively strong.

S&P 500 Video 03.8.17