S&P 500 Price forecast for the week of February 12, 2018, Technical Analysis

The S&P 500 has broken down significantly during the week, breaking down below the 2600 level. The 2500 level underneath is the bottom of the uptrend as far as I can see, and if we can stay above that level, I don’t have any interest in shorting. However, I would also point out that the volume has been extraordinarily large over the last week, so this could have some legs to it. If we break down below the 2500 level, then I think that the market probably goes much lower. Otherwise, if we break above the 2600 level and sustain that level for a couple of days, it’s likely that the longer-term uptrend would continue, and that this was perhaps just a bit of healthy volatility in a market that hadn’t done anything volatile in a while.

If we do rally, then I think the market goes looking towards the 3000 level later this year, which is still my target, unless we break down significantly below the 2500 level. There has been a lot of concern about bond yields rising in the United States, and that seems to be one of the main drivers of stock markets to the downside. I think that the next couple of weeks will be crucial, and quite frankly it might be better to see sideways action in the short term than anything else. Otherwise, the volatility will probably keep a lot of people on the sidelines.

S&P 500 Video 12.02.18