The S&P 500 initially tried to rally during the trading session on Thursday but quite frankly the momentum has been lackluster to say the least, so I do think that it only makes sense that the market would continue to see this as a choppy session. At this point, if we do pull back, I think it will simply be a buying opportunity and I think a lot of people will be looking to get long of this market yet again, especially if the gap underneath. That Sits just above the psychologically and structurally important 4000 level, so it all kind of sits just right for a continuation of the move higher.
S&P 500 Video 09.04.21
That being said, the market is very likely to continue seeing noisy behavior but at this point in time I think what we cannot deny is that it has been extraordinarily bullish for some time. If that is going to continue to be the case, then I like the idea of taking advantage of pullbacks as value. Not only will the 4000 level offer support, but I think the 3950 level and of course the 50 day EMA will come into the picture. The 50 day EMA currently sits at the 3900 level, an area that had been previous resistance, so simple “market memory” could signify that we should see support in that area.
Earnings season is next week, so it is possible we are simply sitting on the sidelines and waiting for that catalyst to kick off, as traders start to focus less on the reopening trade, and more on actual profits for the first time in ages.
For a look at all of today’s economic events, check out our economic calendar.