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S&P 500 Weekly Price Forecast – markets show signs of life again this past week

By:
Christopher Lewis
Updated: Aug 4, 2018, 05:16 UTC

The S&P 500 has initially pulled back during the week, breaking below the 2800 level only to turn around and rally. At this point, the market turned around the show signs of life, as the 2790 level underneath continues to be the bottom of that massive support level that starts at 2800.

S & P 500 weekly chart, August 06, 2018

The S&P 500 continues to show a proclivity to the upside, offering support on pullbacks that allow us to pick up value. I think that the uptrend line underneath needs to be broken for me to start thinking about shorting. At this point, I think that the market will continue to try to grind higher, but obviously there are a lot of concerns out there along the lines of trade tariffs, a strengthening US dollar, and an escalating currency war. However, on the flipside of that equation we do have decent earnings overall, as that should continue to push this market higher.

I believe in buying the dips, and don’t have any interest in shorting but I also recognize that we will get volatility occasionally due to headlines crossing the wires. There is a significant amount of resistance above at the 2880 handle, so I am a bit concerned with that region. If we can break above there, that opens the door to not only 2900 above, but eventually the 3000 level which had been my longer-term target for some time. The question now is whether or not we can reach it this year? There are interest rate hikes coming which tend to be bad for stocks, but the market already knows this and seems to be okay with it as it is gradual and its implementation, and of course size.

S&P 500 Video 06.08.18

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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