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S&P 500 Price Forecast – Stock Markets Continue To Grind Higher Ahead Of Federal Reserve

By:
Christopher Lewis
Updated: Oct 29, 2019, 16:31 UTC

The S&P 500 went back and forth during the trading session on Thursday as we await the Federal Reserve interest rate decision on Wednesday. This shows that the market is trying to break out of the upside and with an anticipated rate cut, this could be the next leg higher.

S&P 500 daily chart, October 30, 2019

The S&P 500 has gone back and forth during the trading session on Tuesday, showing signs of momentum, but a bit of hesitation just below the 3050 level. At this point, if the market can break above there then it’s likely that we will start the next leg higher. At this point I believe it comes down to just how dovish the Federal Reserve will be, because the market of course reflects that more than anything else. As Wall Street has become addicted to “cheap money”, any time we see the potential of that cheap money being cut back, the markets collapsed. Jerome Powell has been taught not to do that by Wall Street, so the fact that they are cutting rates has already been baked into the price. The real question is going to be whether or not the market has the added benefit of a very dovish statement. Because of this, it’s going to be difficult to trade this market for anything other than a longer-term move.

S&P 500 Video 30.10.19

It looks as if the 3000 level underneath will be massive support, and essentially the “floor” of the market. If we were to break down below thereafter the rate decision, that would be in the vein of a massive breakdown. However, I suspect pullbacks will be buying opportunities, just as a break above the 3050 level will be. The market has been bullish for some time, and should continue to be.

Please let us know what you think in the comments below

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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