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Christopher Lewis
S&P 500 daily chart, February 07, 2019

The S&P 500 has had a choppy and somewhat listless trading session on Wednesday as we continue to hang about just above the 200 day EMA. This is a very bullish sign, just simply because we are willing to hang out in this area. However, when you look at the chart you can see that I have three areas circled above right at the 2800 level that could cause major issues. Because of this, I think that we will probably go and test that area eventually, with the 200 day EMA just below offering a bit of support.

S&P 500 Video 07.02.19

The real longer-term question is whether or not we can break above that area. It is a triple top so far, so a revisit of that level would be rather important to pay attention to. If we can break above the highs, then we could continue to go much higher at that point. Otherwise, and I think this is almost as likely, if we could not break above there it’s likely that the sellers will take over and push this market much lower. One of the main things that could come into play in the short term is the US/China talks next week, as they could produce a very negative headlines and send this market much lower. Ultimately, the softening Federal Reserve has helped push this market from the lows to where we are now, but it does look like momentum is starting to run out of bid.

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