S&P 500 Price Forecast – Stock Market Attempts to Recover

US Stock Market Forecast Video for 31.10.23

S&P 500 Technical Analysis

The S&P 500 has rallied a bit during the trading session on Monday, so at this point in time, it looks like we are at least getting some type of relief rally, but also this is a situation where we are going to continue to see a lot of volatility, but volatility means that the market will go in both directions. All things being equal, if we see this market rally a bit, I would be paying very close attention to the 200-Day EMA, which should be a significant technical level as it quite often will define the overall trend.

The 50-Day EMA is above that level and breaking down to the 200-Day EMA given enough time. In fact, if the 50-Day EMA were to break down below the 200-Day EMA, that kicks off the so-called “death cross” that always seems to attract a lot of attention. However, this is a situation where I do think that a short-term rally is more likely than not going to be an opportunity that the sellers will come back in. We are also in the midst of Q3 earnings, so that causes a lot of volatility to say the least.

Furthermore, we also have a lot of geopolitical concerns, like the Israel/Hamas ground war, and then finally we also have to worry about interest rates. If that is going to be the case, then it’s difficult to imagine a scenario where people want to jump into the market and hang on to a position at this point. Quite frankly, we may get a ripping rally in the short-term, but it’s difficult to imagine that we are suddenly going to change the overall trend.

Furthermore, you can also look at the chart and see that there is a nice down-trending channel, and we are at the bottom of it, so it does make a certain amount of sense that all of this coincides for some type of short-term relief rally. Breaking down below the bottom of the Friday candlestick on the other hand, it would be extraordinarily negative given enough time and could even open up and move all the way down to the 4000 level.

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