S&P 500 Price Forecast – Stock Markets Hanging On By a Thread

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The S&P 500 has broken down a bit during the early hours on Friday, but then turned around to form a little bit of a hammer. That being said, the market looks as if it is trying to find its footing in order to go higher. On the other hand, if we were to break down below the bottom of the hammer, then it is possible that the market could go looking towards the 4200 level. If we break down below the Friday candlestick, then I might consider buying puts, but that is as bearish as I get in a market that is so heavily influenced by the Federal Reserve.

S&P 500 Video 04.10.21

The interest rates in the United States have been rising, and that does suggest that perhaps stocks may lose a little bit of their luster, and of course traders still are trying to figure out what the situation is going to be with inflation, as it seems to be as clear as mud at this point. That being said, if we do rally to take out the Thursday hi is, then I would be willing to have a shot at the upside and a bigger move towards the highs again.

One thing to pay attention to on Friday is the fact that it was the end of the third quarter, meeting that there was a lot of bookkeeping and position squaring going on, perhaps causing some of the volatility that we had seen. Regardless, this is a market that I think is going to be very difficult to get your hands on over the next couple of days so a little bit of caution in a smaller than usual position is probably called for.

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