S&P 500 Forecast: Index Threatening to Break Through Support – 26 September 2022
Under no circumstances I am interested in buying the market.
If we break down below the lows of the trading session on Friday, it’s likely that the S&P 500 will go looking to the 3600 level, possibly even down to the 3500 level in the short term. Longer-term, even Goldman Sachs is now talking about a sub-3200 area. In other words, we have further to go to the downside as the world is finally starting to believe the Federal Reserve. The biggest problem has been the Federal Reserve on the way up, and they are going to be the biggest problem on the way down.
The size of the candlestick is likely to continue to see selling pressure based upon what we have, and I do think that this is a market that will continue to see a lot of noisy behavior, that typically does not help the buyers. Volatility has been a major issue, and therefore it makes the idea of risking anything in this market difficult. Ultimately, I think the this continues to be a “sell the rallies” type of situation. On the other hand, if we break down below the bottom, then we just simply dropped to the 3600 level.
The 50-Day EMA is sitting near the 4000 level and dropping, so I do think that it is probably only a matter of time before we would see that come into the picture as well, especially as it is a widely followed technical indicator. I don’t necessarily think that we are going to get there, but it does suggest that we at least have that to pay close attention to. Under no circumstances am I interested in buying the market, and I may find myself watching the market bounce again like it did in June, as nothing has fundamentally changed at this point.
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