The S&P 500 did pull back a bit during the course of the week, but we can see clearly that the buyers have returned. This continues to be the case and I think it is only a matter of time before the market goes looking towards the 3400 level. If we can break above there, then we will have a fresh high. The longer-term outlook for the market of course is bullish due to the Federal Reserve flooding the market with liquidity. Once we break above the 3400 level, I think that the 3500 level will be the next target.
S&P 500 Video 17.08.20
To the downside, I would anticipate that the 3200 level should offer significant support, as it was previous resistance. When you look on the daily chart, you can see that the 3200 level had been tested multiple days in a row so therefore I am fairly confident that it will hold. As long as the Federal Reserve is going to be out there flooding the market with greenbacks, it does make sense of people will be looking to buy assets in order to protect wealth. The market does not seem to want to fall, and we are overstretched.
However, at the end of the day the only thing that people seem to care about is the liquidity measures by the Federal Reserve so that is something that you should be paying attention to. Until then changes, you cannot short this market. Quite frankly, we could have a couple of weeks of negativity that I would simply look past and look at the market with the possibility of buying it “on sale.”
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
More From FXEMPIRE:
- Will Credit Markets Pull Stocks Down – Or Not?
- S&P 500 Weekly Price Forecast – S&P 500 Likely to Break Out
- Natural Gas Price Prediction – Prices Surge and Continue to Trend Higher
- USD/CAD Daily Forecast – Weaker Oil Puts Pressure On The Canadian Dollar
- Our Proprietary ADL Predictions for US Markets
- AUD/USD Weekly Price Forecast – Australian Dollar Continues to Stall