S&P 500 Price Forecast – Stock Markets Run Into Brick Wall

The S&P 500 initially tried to rally during the trading session on Tuesday but showed enough signs of exhaustion to turn around and show negativity and it looks as if perhaps the 200 day EMA and the gap in the same areas should cause a certain amount of trouble. Ultimately, stock markets have gotten far too ahead of themselves and reality and price have started to divorce.

S&P 500 Video 29.04.20

Looking at this chart, if we break down below the bottom of the candlestick and the Federal Reserve does not give the stock markets the monetary methadone that they so desperately need, it is likely that this market will probably pull back and go looking towards the 2750 handle again as it is the bottom of the recent consolidation area. Alternately, if we were to break out to the upside and clear the 200 day EMA, it is likely that the market will then take off towards 3000, and perhaps even higher than that.

Clearing 3000 of course will be an extraordinarily bullish sign but that would take some type of catalyst to make it happen anytime soon. Ultimately, this is a market that I think has gotten a bit over its skis and I think that the 61.8% Fibonacci retracement level above is going to have a certain amount of effect on this market as well. That being said, this could be a problem later this week as well.