S&P 500 Forecast: Making All-Time Highs Again

Christopher Lewis

The S&P 500 rallied significantly on Monday to reach all-time highs yet again. Ultimately, this is a market that continues to go looking towards the 4800 level, which is a large, round, psychologically significant figure, and the next target that I have. I think that breaking above the 4700 level was a good sign, and it should continue to follow that move over the longer term. Short-term dips at this point should continue to attract plenty of attention, as the “Santa Claus rally” will continue. In other words, money managers are going to jump in and try to pick up any bit of value that is offered.

Underneath, the 4600 level would be supportive, but below there we would also have the 50-day EMA near the 4550 handle. It is rising, and it is very likely that we will continue to go higher from that level. Any pullback to that area offers plenty of support from what I can see, at least between now and the end of the year.

Keep in mind that the S&P 500 has nothing to do with the overall economy, so I do not really care what is going on out there. The momentum has picked this market up to the upside, and it is likely that we continue to see plenty of drive to the upside. The market has been in an uptrend forever, and I believe that will probably be the case for the next several months. Whether or not that continues into the next year is a completely different question, but as Jerome Powell has just been renominated, it does suggest that it is only a matter of time before “printer Powell” continues to drive the S&P 500 higher. Any significant selloff will continue to attract plenty of attention from the Federal Reserve, as it finds that its number one job is to protect Wall Street. It sounds cynical, but all you have to do is pay attention to what they been doing for the last 13 years to recognize this. To the upside, I think that eventually we will go looking towards the 5000 level over the next several months. I have no scenario in which I would be a seller anytime soon, with the 4250 level being a massive “floor in the market” going forward.

S&P 500 Index

Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.

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