S&P 500 Price Forecast – Stock Market Pulls Back Slightly

US Stock Market Forecast Video for 02.08.23

S&P 500 Technical Analysis

The S&P 500 has pulled back just a bit during the trading session on Tuesday, as we continue to see a lot of noisy behavior in this general vicinity. With that being said, the 4500 level underneath continues to offer support, and therefore I don’t really worry too much about this pullback. We are in the midst of earnings season, with companies such as Starbucks, Caterpillar, Pfizer, and several others reporting during the day, expect a bit of volatility. However, markets are probably waiting for Amazon and Apple earnings on Wednesday to make their next move.

You should also keep in mind that the jobs number comes out on Friday, and that of course is a major mover of markets, although I think at this point, the S&P 500 has proven that any significant pullback should be thought of as a potential buying opportunity, due to the fact that this market is seemingly willing to look past almost anything.

The 50-Day EMA is currently racing toward that 4500 level, and I think it also offers a bit of support. Ultimately, it’s also worth noting that Citigroup and a couple of other major banks have now raised their guidance for the S&P 500 to hit 5000 by the middle of next year, suggesting that everybody is bullish at this point. Yes, there’s the contrarian trade of shorting when everybody is bullish, but at this point, you need some type of catalyst actually push the market lower. It’s not until we break down below the 50-Day EMA that you can even have the argument about whether or not you should be shorting the S&P 500.

All things being equal, I think any time this market pulls back you need to be looking for signs of support so you can buy into it, and ride the next bounce. With inflation dropping, it looks as if people are betting on the “soft landing scenario” that so many people have been pushing as a narrative over the last several months. Whether or not that actually happens remains to be seen, but that is the story that Wall Street is telling everyone at this point.

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