S&P 500 Price Forecast – S&P 500 Attempts to Bounce

US Stock Market Forecast Video for 05.10.23

S&P 500 Technical Analysis

The S&P 500 has initially fallen in futures markets on Wednesday but turned around to show signs of life. It looks like we are getting a little extended, and it’s probably worth noting that we are hanging around the 50% Fibonacci level from the most recent shot higher. We are below the 200-Day EMA though, and that of course is negative. Because of this, I think we are in the midst of a major decision point, and of course the fact that we have the Friday jobs number is coming has a lot to do with it as well.

Recently, economic numbers in the United States have come out much stronger than anticipated, so that has people worrying about the Federal Reserve and whether or not they will continue to stick with a tight monetary policy. (Here’s a hint: They have been saying they are going to the entire time.) At this point, it looks like tighter monetary policy is just a fact of life, and the question now is whether or not markets will adjust to this. If we were to break down below the bottom of the candlestick for the trading session on Wednesday, that would be a very negative turn of events, perhaps opening up the 4200 level in the futures market, followed by the 4100 level. The 61.8% Fibonacci level is in that same general vicinity, so it would not surprise me at all to have a bit of support in that region as well.

If we turn around and recapture the 200-Day EMA, I think you can make an argument for the market trying to get back to the 4400 level. That being said, a lot of this is going to come down to what the interest rates are in the United States, especially on the short end of the yield curve. If they continue to rise or just stay elevated, then the market will continue to struggle. At this point, I think we may consolidate the next couple of days, if for no other reason than simply trying to get ahead of the jobs number and flatten out positions.

For a look at all of today’s economic events, check out our economic calendar.