S&P 500 Price Forecast – Stock Markets Continue to Struggle

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The S&P 500 has gone back and forth during the course of the trading session on Monday, as we have seen a lot of confusion. The candlestick is of course very neutral and is sitting just below the previous uptrend line. The 50 day EMA underneath offers plenty of support, but at this point in time I think we may be getting set up for a little bit of a pullback. This does not mean that I short the market, rather it means that I might be a buyer of puts if we break down below the 4400 level.

S&P 500 Video 28.09.21

On the other hand, if we take out the 4500 level again to the upside, then it is likely that the market goes higher. At that point, the market is trying to decide whether or not the previous support zone is now resistance, and therefore we could break down below the lows of the previous week. At this point, I suspect that the market would go looking towards the 4200 level, offering an opportunity to pick up puts, but I will not short this market. This is mainly due to the fact that the Federal Reserve will come in and support the markets any time they get outline.

With the market looking so confused, it makes a certain amount of sense that we may have to pull back a little bit to find value. At this point, I think that is probably the most likely of plays, but of course you cannot ignore the breakout. At this point, the S&P 500 is still very much in a significant uptrend, but that does not necessarily mean that a nice 10% correction could not be beneficial.

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