S&P 500 Monthly Forecast: September 2024 (Chart)
Date
9/2/2024 12:04:57 AM
(MENAFN- Daily Forex)
The S&P 500 has seen quite a bit of buying pressure during the month of August after selling off viciously during the previous month. Quite frankly, this is a market that is going to find its way higher one way or another, despite the fact that the underlying Economy does not suggest that companies should be celebrated. Honestly, the S&P 500 is no longer a stock market, rather it is a gauge of liquidity in the financial system. This is why stock markets tend to celebrate bad economic news, because it means Wall Street will get the latest handout to gamble with.
While it might sound cynical, it's the reality of the world we live in now. Economic numbers don't make any difference other than what they have the Federal Reserve doing in reaction. While I don't necessarily think that the Federal Reserve is going to cut 100 basis points between now and the end of the year like the Fed Funds Futures markets suggest, it's obvious that they have been pushed into cutting by Wall Street. In fact, as I write this the Preliminary GDP numbers in America came out hotter than anticipated. That being said, they are still cutting rates.
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Cutting rates means that larger institutions will be able to borrow money and gamble with it on a much smaller cost basis. This is exactly what has been driving the stock market higher since the Great Financial Crisis, which was roughly 14 years ago. Currently, I don't see anything to change that behavior, unless of course we enter some type of Great Depression, which I would not write off, but timing that of course means you are going to be wrong for several months, if not years. In this environment, the only thing that you can do is by the dips until it doesn't work anymore.
The technical analysis suggests that the 5000 level has now become the“floor in the market” from the longer-term standpoint, and it does suggest based on the weekly candlestick that if we do drop from here, there should be plenty of“buy on the dips” type of the trading going on. I suspect that the month of September will be positive.
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