Lately everyone is coming out putting their two cents on where the S&P 500 is headed. I figured I would throw my thoughts out there.
Looking at the chart we can plainly see that the SPX has been trending higher, almost text book perfect for the last two years. Over the last two years the SPX has been in a tight up channel, making higher highs and higher lows. The most important thing about the trend and the technical pattern we are in is, will we continue to see more of the same? My answer is yes! Until we break to the down side making the pattern no long valid we should continue to see the same. With that said whats the upside target? Traders for some reason like round numbers, so my target would be for a print of 2000, about 50 handles away. This target is only valid if we continue to see the same type of price action. The time frame for this to happen is anyones guess, if we hit my target with no pull back that would be unhealthy for the market in general. I would have to believe some type of pull back would happen before we hit 2000.
In conclusion S&P 2000 at some time this year would be a reasonable target after a pull back or two. Keep in mind that market conditions can change, and if they do watch for a violation of the current price pattern.
Targeting a pull back to support before higher prices is now the focus. I think you can look at this a few different ways. The first would be a moving average, I like the 50 and the 150. If price pulls back to the 50 we could see some support with up tick volume and a bounce to higher prices. If price breaks the 50 day the next line in the sand would be the up trend line. At the up trend line we need to look for strong up tick volume for prices to move higher. If price breaks below the up trend line the last line in the sand would be the 150 day moving average.
My personal “want” from the market is sideways action!