S&P 500 Weekly Price Forecast – S&P 500 Continues to See Rotation

S&P 500 Weekly Technical Analysis

The S&P 500 initially tried to rally a bit during the early part of the week, only to turn around and plunge lower. We have seen a lot of stock market rotation this week, and that of course has a major influence on what happens. Remember, the index is not an equal weighted index, so if some of the larger companies get sold into, then you have a situation where the index itself will fall, despite the fact that a lot of other companies may turn around and rally.

With that being said, the 5500 level is an area that a lot of people have been paying close attention to. And if we were to break back down below there, it’s likely that the S&P 500 drops down to the 5300 level. In general, this is a market that will remain bullish. It most clearly has been bullish for a while and therefore, even if we do drop from here, I think you’re looking for some type of bounce and momentum continuation.

Alternately, if we can break above the 5700 level, then we could go much higher. That would just be a continuation of this overextension. Quite frankly, a little bit of a pullback or sideways action to work off some of the excess froth might be a good thing as well. So, it’s still bullish. It’s just a matter of how we break down below 5500. Will we get an opportunity to pick up the S&P 500 closer to 5300? I am not sure, but I would be all over that set up.

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