The S&P 500 has rallied significantly during the course of the week to fill the gap, and therefore it is ready to go much higher. Ultimately, the market is going to reach the all-time highs and then perhaps break above there. I think that short-term pullbacks could send this market down to the 3200 level, which is an area that was previous resistance. At that point it makes sense that there would be support. At this point in time, I think it is only a matter of time before the stock market rallies based upon the Federal Reserve liquidity measures being pumped into the system, which is something that fuels speculation into various assets, including stocks.
S&P 500 Video 10.08.20
Furthermore, you need to keep in mind that there is only a handful of stocks that tend to push this market around, due to the fact that it is not equally weighted. Because of this, I like the idea of picking up value as it occurs, but I also would recommend paying attention to all of the names that everybody else talks about when it comes to stock trading, because it is purely a liquidity game.
Remember, there has been these moves before, and quite frankly as a lot of the macro fundamentalists out there continue to suggest that we are overbought and that the market needs to fall apart because “the markets have divorced from the economic reality.” The reality is that this is about Federal Reserve printing, and nothing else. As long as there is loose monetary policy, the stock market will continue to find support on pullbacks. Earnings season has had almost no effect.
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:
- Gold Weekly Price Forecast – Gold Markets Form Signs of Exhaustion
- Crude Oil Price Forecast – Crude Oil Markets Continue to Grind Sideways
- Natural Gas Weekly Price Forecast – Natural Gas Markets Explode Higher
- Melt-Up Continues While Metals Warn of Risks
- Natural Gas Price Fundamental Daily Forecast – Higher as Buyers Continue to Defend Key Fib Level at $2.149
- Price of Gold Fundamental Daily Forecast – Better Jobs Report Gives Investors Good Excuse to Book Profits