S&P 500 Price Forecast – Stock markets continue to consolidate after break out

The S&P 500 initially tried to rally during the trading session on Thursday but pulled back significantly after making fresh, new highs in the futures market. By doing so we ended up reaching down towards the 3000 level, an area that of course would be resistance. I do believe that it’s only a matter of time before we break out to the upside but obviously we are quite ready to do so yet.

S&P 500 Video 26.07.19

We are in the midst of her earnings season so there will be quite a bit of noise occasionally, but longer-term trend dictates that we go higher, not only because of that but also the fact that the Federal Reserve is going to be cutting interest rates. To the downside, I think there is plenty of support down at the 2950 level, where a massive gap has formed. Beyond that, the 50 day EMA is sitting just below there, so think that’s another reason to think that the gap will hold as support. With all of that in mind, and the fact that we are going into the weekend, it makes sense that during the Friday session we may drift a little bit lower to get to the bottom of the rectangle.

Ultimately, we are still in a range and therefore this makes quite a bit of sense. Eventually though, I do think that we break out to the upside, probably good for about 60 points based upon the size of the rectangle..