S&P 500 Price Weekly Price Forecast – Stock Markets Have Tough Week

The S&P 500 initially tried to rally during the course of the week but then collapsed as we fell towards this major uptrend line. A lot of this was due to the well-publicized retail bashing of Game stop short, and then of course the mask chaos ripple effect that we are starting to see an and over levered environment. With that being the case, it does make quite a bit of sense that we would continue to see negativity throughout the week, but it this juncture we are getting close to significant support. It should be noted that the 3700 level also has a certain amount of psychological support attached to it, but at the end of the day the real support is probably closer to the 3600 level if we do slip through the uptrend line.

S&P 500 Video 01.02.21

All things being equal, the Federal Reserve will step in and bail everybody out eventually, so that is probably the theory that most people are working on. Yes, there have been a lot of losses in the short term but at the end of the day there will be reasons enough to get involved, as this is how Wall Street has been trained over the last 13 years or so. I learned a long time ago not to short indices, so if I do want to express a bearish opinion, I will do so via puts and not shorting this market. To the upside, I think we still go looking towards 4000, but I do not necessarily think that the path there is going to be easy.

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