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

The S&P 500 rallied a bit during the week, breaking back above the 2500 level, reaching towards the 200 week EMA. That being the case, the market is likely to see a bit of trouble in this area, but I also recognize that the markets are trying to figure out what to do next. The fact that we have failed at the 200 week EMA tells me that we probably have more downside coming, and as a result it will be interesting to see if we drop back towards the lows. Quite frankly, I don’t think it would take much to spook traders into shorting again.

S&P 500 Video 30.03.20

Looking at the candlestick, it is somewhat impressive but when you look at it against the previous month or so, it’s obvious that the market has sold off much more drastically, and therefore we probably need to spend some time building up a bit of a base before trying to turn things around. I do believe there is further downside, although I’m not necessarily calling for some type of Great Depression type of meltdown. Trends don’t change without some type of major catalyst, and although the Federal Reserve has stepped in, monetary policy is only going to do so much to turn the economy around, assuming that we are now trading based upon the economy again and not cheap money. That being said, there will be a nice buying opportunity down in this general vicinity, but I think you also have plenty of time as we have seen a lot of profit-taking on Friday, showing just how little faith people have in the markets going into the weekend.