The S&P 500 broke down significantly during the trading session on Thursday, breaking down below the 2750 handle. The market looks likely to continue to go lower in the short term, as we continue to struggle in the face of potential trade tariffs and an escalation of trade war between the United States and China. As long as that is in the background, I think that the S&P 500 will struggle to hang onto gains. However, if things calm down we could turn around and go much higher. If we were to break down below the 2730 handle, the market will test the support level at the 2725.
Below there, I see even more support at the 2700 level, and what I think is the “floor” in the market. Until then, I would expect the occasional reactive bounce. The market continues to look at the 2800 level above is massive resistance, and if we can break above there it would be a very bullish sign. Until then, I would expect a lot of volatility in this market and perhaps use some type of range bound trading system between those major levels. This is a purely emotionally driven market right now, so quite frankly there would be no shame in staying out of it.
S&P 500 Video 22.06.18
This article was originally posted on FX Empire
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