S&P 500 Price Forecast – S&P 500 Pulls Back to Kick Off The New Year

US Stock Market Forecast Video for 03-01-2024

S&P 500 Technical Analysis

The S&P 500 initially tried to rally a bit overnight in electronic trading on Tuesday, but then just fell apart. At this point, it does make a certain amount of sense because we don’t have the Santa Claus rally trying to push things higher anymore.

With that, we may see gravity return, and I do think that the 4,700 level underneath might be an area of interest that traders may try to defend. Quite frankly, it wouldn’t surprise me at all to see the market break down below there as well, perhaps trying to reach down to the 50-day EMA, which is closer to the 4550 level, and would represent a decent pullback. A decent pullback is something that the market has needed for quite some time.

I do like the idea of buying into value after a sell-off. The market has not sold off enough for me to get involved. I think the most bullish scenario that you have right now is possibly trying to carve out a range between the 4,800 level on top and the 4,700 level on bottom as traders try to sort things out. We do get inflation numbers later this week and of course more importantly, in the short term we get the jobs numbers on Friday, which really could get markets moving.

The next couple of days will probably be a bit noisy more than anything else, and therefore, I do think that profit taking, or perhaps even selling, may be a big part of that situation. By the time we get through to the end of this week, though, we should start to see larger traders come in and try to put in positions for yearly investments, so we’ll have to see how this plays out.

Keep in mind that the S&P 500 is driven by just a handful of stocks, and could, in theory, be called the S&P 7 after what we’ve seen over the last several months. Ultimately, though, the market got too far ahead of itself and does desperately need to be corrected.

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