S&P 500 Price Forecast – Stock Market Stalling Heading Into The Holidays

US Stock Market Forecast Video for 21.12.23

S&P 500 Technical Analysis

The S&P 500 has done very little during the trading session on Wednesday as we are simply killing time and waiting for the holidays to come. Ultimately, this is a scenario where traders just don’t have much in the way of reason to put a lot of energy into the markets now, as the liquidity will disappear and therefore you have to be very cautious about putting a lot of money into the market. Furthermore, we have the specter of some type of profit-taking between now and then that could send the market plunging. That doesn’t mean it has to happen, just the reality is that sooner or later people are willing to get paid.

Underneath, the 50-Day EMA is above the 4500 level, and is rallying to reach the most recent consolidation area just above there. If we can drop down to the 4600 level, then it’s an area that a lot of people will be paying attention to as a potential buying opportunity. I do think that the S&P 500 continues to go higher, but it is a stretch to say the least. In fact, since the recent rally at the end of October, we have gained about 16 ½%, which is a good year by most metrics, let alone just a couple of months. We are overdone, so I’m very cautious about buying all the way up in this area regardless of whether or not it is the holiday season.

In general, I think that the market is probably going to try to get to the 5000 level but it’s very likely that we continue to see a lot of noise between now and then, as we will get the occasional selloff. That selloff will be a buying opportunity as long as the Federal Reserve is likely to loosen monetary policy, which of course they have suggested recently. After all, Wall Street loves cheap money, and therefore it’s likely that we will continue to see stocks rise, at least the most popular ones, which is what moves the index, not the totality of the 500 companies represented.

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