S&P 500 Price Forecast – S&P 500 Treads Water

Christopher Lewis
Published: Feb 28, 2024, 14:50 UTC

The S&P 500 continues to hover around the highs, as market participants continue to look to the Federal Reserve for cues on what to do.

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S&P 500 Technical Analysis

The S&P 500 has done very little overnight in the electronic trading session as we are just simply treading water. At this point in time, the market is obviously very bullish, and I don’t think anybody out there doesn’t see that, but really it comes down to how you approach this. Are you willing to chase the S&P 500 or are you looking for value?

I postulate that value is the way you should be treating this after all. This is a market that has expanded about 25% in the last couple of months, and therefore it’s due for some type of correction. A pullback to the 5,000 level would be very minor, but it would signify a large round number that a lot of people would be paying attention to. So you do need to keep that in mind. I think a lot of people might be interested in going long at that point.

A lot of this comes down to whether or not the Federal Reserve is going to cut this year, and they most certainly are. They’re projecting to cut three times their interest rates, so that should give stocks a little bit of a boost this year. The question now is, where do we enter? And again, I think the 5,000 level would be an excellent area, but if we break above 5,100, then the FOMO probably picks up again, and people just simply jump in and start buying.

Anything below the 5,000 level starts to attract the attention of the 50-day EMA and then eventually the 4,800 level. I don’t have any interest in shorting this market and quite frankly, it’s just a handful of stocks that move it anyway. So with that, as long as you keep an eye on the so-called Magnificent 7, there really isn’t a whole lot to do other than pay attention to those stocks and use this as an ETF. After all, there’s about 493 stocks out there that nobody really pays attention to. It’s just the facts of life here.

I do think we go higher given enough time, but you need to be cautious. You don’t want to just chase the trade willy-nilly. That being said, we have a very strong bullish trend, so you have to trade this market as such.

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About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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