S&P 500 To 2000 Or 2350 Depending On Momentum At Key Level

The S&P 500 is once again up against the critical 2100 level that has proved difficult to break through for roughly a year now. According to BTIG analyst Katie Stockton, the market is likely in for a big move one way or the other in coming weeks.

“We think a failed breakout is likely given the return of short-term overbought conditions per the daily stochastics, among other longer-term factors, but we would defer to the momentum behind the market if the breakout is confirmed,” Stockton explained.

Related Link: JPMorgan Expects S&P 500 To Make New All-Time Highs Within Weeks

“If the breakout is confirmed, the width of the downtrend channel would yield a long-term target of about 2350 for the SPX,” Stockton noted. Of course, that 2350 target would represent a new all-time high for the market.

If the S&P 500 fails to break out significantly above 2100, BTIG believes it will soon be headed back to 2000 or lower.

Every time the S&P 500 fails to penetrate the 2100 level, support at 2000 becomes less and less reliable. Stockton believes that yet another failed test of 2100 could mean that the 1925–1950 support might be in play.

After a horrendous start to the year, the SPDR S&P 500 ETF Trust (NYSE: SPY) has bounced back in a big way and is now up 3.3 percent in 2016.

Disclosure: The author holds no position in the stocks mentioned.