S&P 500 shift to intermediate-term neutral range – S&P 500 forecast

Intermediate
  • A shift back to a “risk on” phase over the past 24 hours with major equity averages popping higher on positive news a study from Chicago on the potential positive treatment of the COVID-19 virus.
  • This has seen a resumption of the up trends from March and the surge higher by most major global stock indices last week, with the US benchmark average, the S&P 500 posting its largest weekly percentage gain since 1974.
  • Moreover, the S&P 500, has now probed above a key resistance level, and from our technical perspective to shift the intermediate-term outlook from the February-March bear trend, to a broader, intermediate-term range.

S&P 500 outlook: Intermediate-term shift to neutral above 2884.75, upside risks

A positive consolidation theme on Thursday holding above our 2701.0/2698.5 support zone, at 2746.0, then a bull gap surge overnight (gap 2851.75-31.5) to a new recovery high at 2885.0 just above our key 2884.75 level, to shift the intermediate-term outlook from bearish to neutral AND to resume upside forces intact from this week’s firm extension rally, to keep risks higher into Friday.

  • We see an upside bias for 2885.0; a break above aims for 2916.0 and 2950.5, maybe towards 2984.25, even 3000.0.
  • But below 2851.75 targets 2831.5, which we would look to try to hold; through here aims for 2806/05, maybe 2772.5.

S&P 500 intermediate-term outlook

The mid-April push above 2884.75 signalled an intermediate-term shift from bearish to neutral, with a range seen as 3137.0 to 2424.75.

  • Downside risks: Below 2424.75 sets an intermediate-term bear trend to aim for 2174.0, 2000.0 maybe 1802.5.
  • Upside risks: Above 3137.0 sets an intermediate-term bull trend to aim for 3397.5 maybe 3500.0.

4 Hour S&P 500 Chart

SP 500 chart

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

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