The S&P 500 Chops Aimlessly

The S&P 500 has gone back and forth during the trading session on Tuesday as we continue to look for some type of direction. The inflation numbers coming out on Thursday in America will probably be the big event for the week, and at this point in time it looks as if we are trying to figure out what we are going to do after the announcement. Quite frankly, if inflation comes out hotter than expected, that could send this market reeling to the downside. From a technical analysis standpoint though, it looks as if we are essentially doing what you would expect.

S&P 500 Video 09.02.22

We are sitting below the 4500 level which of course has been important multiple times, so it is worth paying close attention to what happens next. We are sitting between the 50 day EMA above and the 200 day EMA underneath. This typically causes a bit of a “squeeze” in the market, as we have major pressure from both sides at the same time. Given enough time, I do think that we will break out of this, but we need to get through the Thursday CPI numbers first.

Looking at this chart, I think it is more or less a 50-50 proposition as to which direction we moved next, so looking at this chart we need to wait and see how the week ends up, because right now it is essentially gambling as markets have had big moves in both directions intraday with a serious lack of volume. Typically, when you have a lot of indecision like this, it is a negative sign, but it is not enough to get be shorting the market quite yet.

For a look at all of today’s economic events, check out our economic calendar.