S&P 500 Weekly Price Forecast – S&P 500 Slams Into the 200 Week EMA

S&P 500 Weekly Technical Analysis

The S&P 500 has fallen rather hard during the week, slamming through the 3700 level, and crashing into the 200 Week EMA. At this point, the market looks likely to break down even further, with perhaps an eye on that 3500 level. Keep in mind that the rallies at this point in time should be thought of as “bear market rallies, which can be very aggressive, but end up being nice selling opportunities.

The 4000 level is an area that a lot of people will pay close attention to, as it is a large, round, psychologically significant figure, and an area where we have seen action previously. Nonetheless, this is a horrific-looking chart, and although it cannot go down forever, the reality is that the momentum is not picking up for the buyers, nor are the fundamental reasoning for long positions.

The Federal Reserve continues to tighten interest rates, and therefore looks as if it’s not going to let go on its fight against inflation. The only way they can truly fight inflation is to destroy asset prices as it brings down demand. At this point, it’s difficult to imagine a scenario where you suddenly have to get bullish. I suspect we have much further to go, and that the “everything bubble” is still in the process of popping.

I typically don’t like the idea of shorting US indices, but it’s been an easy thing to do over the last two months. Ultimately, we need to see some type of change in the attitude of the Federal Reserve for market participants to think about getting overly bullish. That’s not going to be the case anytime soon, so I remain bearish.

S&P 500 Weekly Forecast Video 20.06.22

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