S&P 500 Price Forecast – Stock Markets Recover From Extreme Oversold Conditions

Technical Analysis of the S&P 500

Due to the fact that it seems as if we are approaching the 50-Day EMA, the S&P 500 has increased a little in the E-mini contract during the trading session on Wednesday. In the end, I believe that this market is attempting to reach some kind of balance between this point and the year's conclusion.

 After all, this is the year's worst period for liquidity, and there have undoubtedly been many worries lately. Even if Wall Street was waiting for a giveaway, Jerome Powell has been sure to underline the concept that the Federal Reserve was going to remain tight for a while.

A significant flush down might occur if we close below the hammer from the Tuesday session, but I don't believe it will happen straight away. Since this market has been overdone, in my opinion, we are merely rebounding until we see an exhaustion candle. I won't hesitate to start selling on that exhaustion candle since, to be honest, I believe it would be a really bearish indicator. In the end, I do believe that we will decline because, very honestly, a severe recession is imminent and it is clear that Wall Street is now beginning to concur with all of the forecasts.

To consider this a prospective market worth purchasing, we would need to at the very least knock out the top of the 200 day EMA. I just don't see how that could occur, therefore I believe you are watching for a chance to go short once again. You just don't know; it may happen in January or it might happen right now.