S&P 500 Price Forecast – Stock Markets Pulled Back a Bit

US Stock Market Forecast Video for 10-01-2024

S&P 500 Technical Analysis

You can see the S&P 500 pulled back just a bit during the trading session early on Tuesday as we are trying to work off some of the froth from that massive candlestick on Monday. That being said, I suspect this ends up being a buy on the dip opportunity. In fact, I’d be a bit surprised if we broke back down below the 4700 level.

At this point, it looks like we’re trying to form some type of bullish flag or at the very least form some type of trading range to work off the excess froth from last year when we really shot straight up in the air. After all, the market has really not had a significant pullback. And as a result, I think sooner or later that has to happen. That will be a massive buying opportunity, especially if interest rates start to fall even further in the United States. And the Fed, of course, decides to cut its interest rate. This is going to continue to be the story. It’s going to be about Fed liquidity, loose monetary policy, tight monetary policy, that’s the only thing anybody cares about, the underlying economy not so much.

That is what traders use to determine what’s going to happen with monetary policy. So bad news is actually good news for the stock market at this point, as we have seen multiple times in the past. It’s part of the distortion that the Federal Reserve has kicked off since the great financial crisis. Wall Street is hooked on this cheap and easy money, and therefore, it’s really the only thing that gets the markets moving. While there might be an initial negative reaction to bad economic figures, you will see more often than not buyers will step back in to pick up the market.

You should also keep in mind that the S&P 500 is levered to about seven stocks, so it’s all the usual suspects that will determine where we go next. As per usual, you will be paying attention to Tesla, Microsoft, Amazon, and all of the other stocks that everybody else owns. Either way, it does look bullish longer term.

For a look at all of today’s economic events, check out our economic calendar.