S&P 500 Price Forecast – S&P 500 Continues to See Buyers

S&P 500 Technical Analysis

The S&P 500 rallied a bit during the trading session here on Monday as traders have come back into the markets to find appetite for risk accelerating. In fact, this started in Asia with the Nikkei 225 and has followed through with multiple other indices. This is simply a factor in the liquidity issues that are starting to show themselves worldwide.

The 5200 level above is a major resistance barrier and I do think that we are going to try to get there. If we can break above there, then it is likely that we will go much higher. I think more likely than not, the best trade is to simply buy pullbacks and look for value along the way. After all, this is a rally that seems to be somewhat relentless.

And now that we are starting to see a broadening of the rally, meaning that it’s not just the same seven stocks, that’s even more impressive. That’s a sign of a healthy market, despite the fact that we are straight up in the air. The 5,000 level underneath is an area that should offer a lot of support right along with the 50 day EMA, so all things being equal, I do think that’s your floor in the market. Longer term, I think you have to look at this as just a simple game of liquidity from central banks.

Speaking of central banks, the FOMC meets this week, so keep that in mind. That will obviously be a major influence on where we go next, but really at this point in time, it seems like Wall Street has made up its mind. It’s going to be a buyer, regardless of what the central banks do. Yes, they say it’s all about interest rates, but the reality is it doesn’t seem to matter what Jerome Powell says. They will find a reason to look for lower rates down the road.

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