S&P 500 Price Forecast – S&P 500 rallies significantly after CPI miss

The CPI number came out lower than anticipated in the United States during the day, which shows a lack of inflation. That also could be a negative mark on the economy, because that means that there should be more cheap money from the Federal Reserve. And hence, the reason the market is rallying. At this point, the market is gauging with the Federal Reserve is going to do as far as monetary policy, and simply trading accordingly. I don’t think that the dynamic is going to change anytime soon, and it simply means that cheap money is good for the S&P 500, while everything else is secondary.

We have recently held massive support, and when you look at the chart now, you can see that on the hourly chart there has been a bit of a rounded bottom formed. I think that we will continue to see buyers on dips, but there will be the occasional selloff that will be quite drastic due to headlines, especially if they involve the United States and China. Markets are becoming much more volatile, now that traders are back from holiday. In the short term I would expect the 2900 level to offer a bit of support, so a pullback that isn’t some type of meltdown that showed support in that area might not be a bad idea to start buying. Below there, I think the 2890 level also offer support.

S&P 500 Video 14.09.18