S&P 500 Price Forecast – Continue to Face Headwinds at 3500

The S&P 500 did rally a bit during the trading session on Monday, reaching towards the 3500 level. That is a large, round, psychologically significant figure that will attract a certain amount of attention, and it has caused a bit of a reaction every time we approach it. Furthermore, it is worth noting that the Thursday candlestick was a hammer, the Friday candlestick was a shooting star, and now the Monday candlestick is looking very much like one that is showing resistance as well. Because of this, the technical analysis looks like we are certainly looking at a range as well.

S&P 500 Video 20.10.20

This setup a nice trade for those of you looking towards short-term charts, as we can go back and forth and show opportunities in both directions. Although one could make an argument that we have just formed a “double top”, I think that is probably jumping the gun. I would anticipate that there is a lot of support below at the 3400 level, and it is likely that we would find the 50 day EMA reaching towards that area by the time we get there. All things being equal, we are still very much in an uptrend, so that is something worth paying attention to.

At this point, the market is focusing on the idea of whether or not we get some type of stimulus, and of course the value of the US dollar. If the US dollar continues to strengthen, then it is very likely that will continue to weigh upon the stock market.