S&P 500 Price Forecast – S&P 500 Continues to Hang Around

US Stock Market Forecast Video for 28.11.23

S&P 500 Technical Analysis

The S&P 500 did very little during the trading session on Monday, as we continue to work off some of the excess froth that the market has recently seen. Quite frankly, we are overstretched at this point, therefore it makes quite a bit of sense that we take a bit of a breather, as we have gained over 10% in just a couple of weeks. The so-called “Santa Claus rally” is very much in effect, but that doesn’t necessarily mean that we can pull back. With this, I think you need to look for value and when it comes, start looking for an attempt to pick the market back up.

The 50-Day EMA is sitting above the 4400 level, and therefore it means that we are looking at a potential floor in the market in that area, assuming that we even pull back from there. Furthermore, we also have a previous trend line that made up the down trending channel that could also offer a lot of support as well. Conversely, if we do take off to the upside, the market is going to test the recent all-time high, and therefore could really start to melt up.

In general, I think a pullback is not only necessary, but it is most likely about to happen. This does not necessarily mean that I’m willing to short the market, just that I would not necessarily be looking to pick up new long positions here. After all, even though we have had a huge move higher, the pullback is probably going to be where you initiated position. If you are ready long of this market, it’s probably time to start thinking about taking profit, or at least moving stop loss is higher.

Also, keep in mind that at this time of the year we typically have a lot of money managers out there trying to chase performance, and therefore they will jump into the market and buy the stocks that everybody else owns in order to be able to show their clients that they have been involved in the “correct markets.” Ultimately, a little bit of patience probably goes a long way in this market, as the overextension is getting extreme.

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