The S&P 500 technical analysis forecast for 2014

<p>Looking back: S&P 500 price movements during 2013 The S&P 500 (a daily chart of which is shown) consistently defied gravity in its relentlessly accelerating […]</p>

Looking back: S&P 500 price movements during 2013

The S&P 500 (a daily chart of which is shown) consistently defied gravity in its relentlessly accelerating advance of 2013.

Despite several relatively shallow pullbacks throughout the year, the index continued to breakout to new highs. From its first historic close above 1600 in May, the S&P 500 continuously established higher all-time highs for the remainder of the year.

Neatly framing this remarkable climb has been an accelerated uptrend support line extending all the way back to the November 2012 low at 1342.


S&P 500 technical analysis chart



Throughout the course of 2013, the index corrected down to test this trend line on three separate occasions, but an expected rebound occurred each time.

Another bullish indicator lies in the relationship and positioning of the major moving averages. The 50-day moving average has consistently been rising well above the 200-day average, as has generally been the case since at least July 2012.

The very last day of 2013 saw the S&P 500 hit yet another record high, this time at 1849.

Looking forward: the S&P 500 forecast for 2014

The first several days of 2014 have seen a tight consolidation just under this new high.

Moving further into 2014, an overdue pullback should likely occur, although not necessarily one that would potentially deter or reverse the long-term bullish trend.

In the event of this pullback, a key support level currently resides around 1760. With a continuation of the entrenched uptrend on a breakout above the current record high, immediate price targets reside around 1900 and then the 2000 psychological level.



Interested in what the year might bring for the major currency pairs? Check out the other articles in this series:

GBP/USD forecast for 2014
EUR/USD forecast for 2014
USD/JPY forecast for 2014
AUD/USD forecast for 2014


You can also read James’ 2014 predictions on Gold, here.

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