S&P 500 Weekly Price Forecast – Stock Markets Continue to Rally

The S&P 500 has initially pulled back a bit during the course of the week, reaching down towards the uptrend line. That being said, we have bounced significantly and then went higher from there. The candlestick of course is a bit of a hammer, and if we can break above that then I think we continue to go much higher. When you look at the chart, you can see that we had previously been consolidating in a 400 point range, between the 3200 level and the 3600 level. Extrapolating that move opens up the possibility of a move towards the 4000 handle.

S&P 500 Video 11.01.21

Every time we pull back, there seems to be plenty of buyers in this market, and therefore I think it is likely to continue to be a scenario where we look for value and any time, we break lower, people will be willing to get involved. All things being equal, the market is likely to continue to be based upon the idea of cheap money, and of course stimulus overall. The tail on the candlestick is rather extensive, but I think a lot of people would be looking into that tail as an opportunity to pick up value, so again I think there is no way to short this market.

That being said, if we get a weekly close below the 3600 level, it could be the beginning of a pullback that could go down to the 3400 level. The 50 week EMA is at the 3326 level, and could offer a bit of support as well, assuming that we would even get down there.

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