S&P 500 Price Forecast – Stock markets in rally mode on Monday

The S&P 500 shot higher during the trading session on Monday as a bit of follow-through to the hammer on the Friday session. This of course is a very bullish sign but competing is a negative weekly candle that was a bit of an outside bar. That of course is negative. So in the short term it looks very likely to rally a bit, but I also think that there is a lot of resistance near the 2800 level still, and I do not think that we are likely to break above there in the short term. That doesn’t mean we can’t, just that the odds don’t favorite quite yet.

S&P 500 Video 12.03.19

With that in mind, it’s not until we break above the 2820 handle that I would be willing to take a longer-term trade towards the 2900 level. Signs of exhaustion near that area should be excellent opportunities for selling, just as a turnaround and a break below the 50 day EMA would be an excellent sell signal. This is a bit of a “two speed market”, meaning that the longer-term grind higher has of course been very crucial, but we are also seeing bearish signs on the weekly chart at the same time. In other words, this means that there is going to be a lot of volatility and choppiness, but that of course isn’t anything new in this market.

With that in mind, it comes on your timeframe, or perhaps you can take the safest trait of all: simply sitting on the sidelines until we get a significant break out or break down that can be followed through. In other words, we would need to be forming a daily close above 2020, or selling a daily close below the 2700 level.

Please let us know what you think in the comments below