The S&P 500 has slowed down a bit during the course of the trading session on Friday, just as we have seen happen multiple days in a row. At this point in time, the market to simply looks as if it is running out of momentum. If we pull back from here, I think there are plenty of areas where there would be buyers, not the least of which would be the 50 day EMA. The 50 day EMA is starting to curl higher, so that of course is a bullish sign.
S&P 500 Video 25.10.21
On the other hand, we could break out above the top of the range for the Friday session and then go looking towards the 4600 level. If we break above the 4600 level, then it is likely that we go much higher, perhaps even towards the 5000 level over the next several months. This is a market that continues to be very noisy, but ultimately the general direction is still to the upside. Looking at this chart, it is obvious that we are in an uptrend and this recent turnaround has formed a bit of an inverted head and shoulders.
That obviously is a bullish sign and will cause a bit of buying pressure, but quite frankly the last thing the market needs is some type of reason to go higher. Wall Street is excellent at coming up with narratives, and the most certainly will. The most likely one will probably stem from something going on in the earnings season that we are presently going through.
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This article was originally posted on FX Empire
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