S&P 500 Technical Analysis
The S&P 500 rose slightly during the trading session on Thursday, as it looked like we were going to try to break through the 4200 level. At this point, the market is unlikely to see a bit of selling pressure, but we also have non-farm payrolls announcements coming up, so that’s something to pay attention to. A pullback at this point is likely due to higher numbers, as people start to worry again about the Federal Reserve and whether or not they will be forced to tighten monetary policy.
The 200-day EMA is sitting just above the 4000 level, and this will certainly be an area where many people will pay close attention, as the circular figure will obviously attract a lot of attention. If we break below the 200-day EMA, the market may very well test below the 50-day EMA. Much of this comes down to whether or not people believe the Federal Reserve will continue to tighten and slow the economy. After Wednesday’s announcement, it seems the market isn’t really interested in what the Federal Reserve has to say, at least not right now.
You should also keep in mind that there’s a lot to pay attention to as we’re in earnings season, so it makes sense to a certain extent that volatility will likely increase, not decrease. If we can break out the 4200 level after the jobs number, it is going to move quickly towards the 4300 level.
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