S&P 500 Price Forecast – Stock Markets Continue to Face Same Foe

The S&P 500 has initially pulled back ever so slightly during the trading session on Monday, only to turn around and rally towards the 3400 level yet again. That is an area that has been difficult to deal with as of late, so do not be surprised at all to see that area hold. However, if we can close above the 3420 level, then it opens up the possibility of a much bigger move. This will almost certainly have something to do with stimulus, as Wall Street continues to live off of “cheap money.”

S&P 500 Video 06.10.20

At this point in time, there are earnings to think about but at the end of the day earnings have almost nothing to do with the way stocks move. It is all about liquidity, and as long as there is plenty of it there seems to be a reason to buy stocks. It is the old adage “there is no alternative” that a lot of stock traders are using. To the downside, the 50 day EMA looks very likely to offer a bit of support, and therefore I think we are in fact trying to build up some type of momentum to finally break out.

At the end of the day, stock indices or not to be sold, almost ever. After all, they are not designed to fall, this is why the weighted stock index will pick a few particular stocks to base a majority of the gains or losses upon. You are not buying the average 500 stocks; you are essentially buying the average of seven or so. In other words, there is a reason why buy-and-hold works.

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