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

The S&P 500 has run out of steam during trading on Wednesday, as the markets are a bit overextended. At this point, if we pull back from here it’s likely that the market will eventually pull back to find buyers underneath, and those buyer should continue the overall uptrend. The 3050 level is of course an area that will attract some attention due to the fact that it is a “mid-century mark”, but there is also structural support at the 3030 level, and then the psychologically and structurally important 3000 level is underneath there as well.

S&P 500 Video 07.11.19

All things being equal, I like the idea of buying dips as it gives you an opportunity to pick up a bit of value in a market that is obviously bullish. As the central bank is out of the equation, it’s likely that the market can simply grow from here. Looking at the overall attitude of the market, we are getting close to the top of a channel, and that of course is worth paying attention to. If we were to break down below the 3000 level, it would also wipe out the 50 day EMA which of course is a very negative sign also.

That being said though, look at this impending pullback as a potential buying opportunity, as every time we pull back it seems as if buyers are willing to come back into the equation. Looking at the ascending triangle on the chart, the market is likely to go looking towards the 3200 level given enough time, but we may need to backfill a little bit.

Please let us know what you think in the comments below

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