S&P 500 Price Forecast February 9, 2018, Technical Analysis

The S&P 500 has rolled over a bit during the trading session on Thursday, breaking below the 2650 handle, perhaps reaching down towards the 2600 before it’s all said and done. I think that the bearishness continues, and we may have a bit further to go. However, I think that eventually you will see value hunters come back into this market, as I anticipate there should be supported not only the 2600 level, but the 2550 level, and the 2500 level after that. If we were to break down below the 2500 level, that would be very negative, perhaps sending the market into a very bearish tone longer term.

The S&P 500, along with other US indices, had gotten far ahead of itself and it makes sense that we had this massive selloff. Markets in general have been far too complacent, so it’s good to see the volatility is coming back, because in the end it makes longer-term trends much healthier when the occasional bearish move happens, flushing out the “weak hands.” Longer-term, I still believe that we go to the 3000 level, but it is going to take a lot of work to get there. More importantly, it’s going to take a lot of confidence building which I suspect will be done at these lower levels. Confidence being built into the market may take several sessions, so I would not expect some type of “V-shaped” recovery. Look for a slow gentle grind higher once we finally find enough value hunters.

S&P 500 Video 09.02.18