The future is foggy to say the least, I will not speculate about what was responsible for this drop in the SPX , but one thing is for sure, the economic signals are very deteriorated and the stock market is overvalued. A big Crash is coming, but when? We cannot be certain.
The and gives us no clear indication here.
The price has hold in 2 very strong support levels, MME200 and 23.60% Fibo retracement. The next levels o support in case the SPX drops are:
- 2745 pts (38.2% Fibo retracement)
- 2665 pts (50% Fibo retracement)
- 2585 pts (61.8% Fibo retracement)
In case the price goes up, we have the following resistances:
- 3020 pts (the last top)
- Around 3150 pts (Upper band of the )
What to do?
For now, if you have a healthy allocation strategy playing out, with enough hedge to counter a coming Crash, technically speaking it is a good time to buy more ETFs that follows the SPX .
In the other hand, I do not recommend any speculative trade for the index.
Leave your thoughts bellow.
Do you agree with this analysis?
What are your views for the S&P 500?