Stock Markets Take a Beating on Friday

The S&P 500 initially tried to rally during the trading session on Friday but gave back the gains as we got close to the 200 day EMA. By doing so, it looks as if we are going to continue to see a lot of negativity, as we have fallen rather hard. That being said, the market looks likely to look towards the 40 to 50 level underneath, where we had bounced from previously. I see this is a huge “H pattern”, and that does suggest that we are going lower. Because of this, I think that at the end of the day you probably have a situation where we will try to test the bottom that we had previously, but if we can break down below there it is likely that we could continue to go much lower.

S&P 500 Video 21.02.22

If we turn around and break above the top of the candlestick for the session on Friday, it is possible that we could go looking towards the 4475 handle, where we started to fall from a couple of days ago. Geopolitical concerns, inflation, and of course lackluster guidance from several companies continues to weigh upon this market. Ultimately, I do think that the S&P 500 is starting to finally price in the slowdown that is almost certainly going to be coming next quarter.

The only way I see this market turn around for a bigger move and anything other than a “bear market rally”, would be if the Federal Reserve suddenly changes its attitude. That does not look likely to happen anytime soon, so with this I believe that we continue to fall.

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