S&P 500 Price Forecast – S&P 500 Continues to Grind Higher

S&P 500 Technical Analysis

The S&P 500 rallied a bit early on Monday after initially gapping to the upside, pulling back to fill that gap, and then turning around again. Underneath we have the 50-day EMA and the 5,000 level, both offering plenty of potential support areas. And with that, I think you remain buy on the dip. Remember, the S&P 500 is not equal weighted, if popular stocks, the top 10 or so, are rallying the index itself has to go higher. Keep in mind, we are in the midst of earning season, so that does cause a little bit of noise, but we have a serious lack of macroeconomic announcements coming this week, so that does help. The quiet macroeconomic calendar should provide cover for stocks that continue going higher.

At this point, it would not surprise me at all to see this market try to get to the 5300 level, which is right about where we peaked out at. We recently had a nice little correction here of about 6.8%. So, a nice correction in a longer term up move which is exactly what the market needed. Now people are starting to chase that value proposition again.

Things remain somewhat steady from a news flow perspective and the bond market doesn’t really take off with the yields, it’s very possible that we end up at the highs again somewhat soon. Now that doesn’t necessarily mean that it’s going to be easy. I just think the proclivity of the S&P 500 right now is still to go to the upside and that does make a certain amount of sense. It’s not an equal weighted index after all. So, with that being said, I remain bullish, but I also recognize that we have some work to do to get to the highs.

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