S&P 500 Price Forecast – Stock Markets Continue to Test Support
The S&P 500 has broken down a bit during the trading session on Friday as we reach down towards the 3200 level. This is an area that of course would be crucial to pay attention to as it is not only a large, round, psychologically significant figure, but it is also the scene of the 200 day EMA and an area where we have bounced from recently.
S&P 500 Video 02.11.20
At this point, I think the market is trying to stay somewhat range bound and that would not be a huge surprise considering that the election is just a couple of days away. There is a lot of confusion as to where the US government will end up as far as the makeup is concerned, because suddenly we are starting to see Wall Street hedge its bets. Furthermore, the question is not just about the presidency, but also whether or not the Republicans hang on to the Senate. In other words, there is a lot of moving pieces right now.
Further sticking its nose into the situation is going to be the coronavirus numbers are climbing both in the United States and in the European Union. This suggests that perhaps the economies are going to lock down again, and as a result I think what we are going to see is continued concern. The best way to trade this market right now is to either buy on a sign of bouncing, or by the US dollar if we start to break down. Shorting the S&P 500 is going to be a bit difficult, because once it falls, it quite often will turn around very violently based upon a headline.
For a look at all of today’s economic events, check out our economic calendar.