Stock Market Continues to Go Back and Forth

S&P 500 Weekly Technical Analysis

The S&P 500 has gone back and forth during the course of the week to form a relatively neutral candlestick, after forming a shooting star from the previous week. At this point, the market is trying to decide whether or not it is going to break down, or if it is going to turn around and break above the top of the shooting star? That would of course be a very bullish sign, and that could show that we are ready to explode to the upside.

On the other hand, if we were to break below the bottom of the candlestick, that could open up the possibility of a move down to the 4350 handle, which is where the 50 Week EMA sits. All things being equal, this is a market that has been noisy for quite some time, and therefore you need to understand that the volatility profile could cause major issues. With this in mind, I have been keeping my position size relatively small, because I know that this is a very nervous market under the surface, and that means that we could explode in one direction or the other rather quickly if we are not careful.

Keep in mind that this is all about the idea of potential liquidity coming out of the Fed or not, so keep an eye on speeches coming out of the Federal Reserve, and of course, any actions that the central bank makes. Ultimately, this is a market that will continue to be very noisy and therefore I do think that there is quite a bit of opportunity out there if you are nimble enough.

S&P 500 Forecast Video 11.04.22

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