S&P 500 Price Forecast – Stock Markets Continue to Digest Gains

The S&P 500 has pulled back initially during the trading session on Wednesday, but quite frankly this is a “buy on the dips” type of scenario. Not only is the market in that attitude, but you also have to keep in mind that fund managers out there will be chasing returns between now and the end of the year. Quite frankly, that is what causes the phenomenon known as the “Santa Claus rally”, so be aware of the fact that the phenomenon is well documented.

S&P 500 Video 11.11.21

At this point in time, I believe that any dip will end up being thought of as a buying opportunity, and at this point it is not until we break down below the 4250 level that you would have to be concerned about the overall trend. If we break down below there, then it is likely that the market would be one that I can buy puts in, but that is about it. The upside features a move towards the 4800 level, possibly even the 5000 level over the longer term. We are overextended, but quite frankly that is with these markets do.

Ultimately, I believe that this is a market that needs to at the very least digest some of the gains, but at this point in time you certainly cannot be short of this market, as I have been saying for the last 13 years. The 50 day EMA is just above the 4500 level and racing higher. I would anticipate that could be a bit of a support level, and therefore I think that value hunting is the way to go more than anything else.

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