25 Oct 2021, 10:51

The stock market continued to rise throughout the week after it bounced off a strong channel support line earlier in the month. However, the momentum in the S&P 500 Index has seem to stall after it reached back its previous all-time high again. Question now is whether it will break its all-time high and continue the uptrend? Or will the all-time high mark act as a resistance and push down the index again?

Next week is crucial as the next move would determine where the short-term movement in the market would be heading to. If there is a break of an uptrend, then we expect the index to head towards the blue resistance line before it makes the next correction. If the all-time high acts as a resistance, then we may expect abit of consolidation to take place in the index. This may bring the index down to the black channel support line for another new wave up. Either way, we are not too worried about a stock market crash in the near term as this new wave up may bring the index to break above the all-time high resistance at the brown line. We think it would only be a matter of time for the all-time high resistance to be broken. 

Let’s keep things simple as this would most likely continue till the end of the year. However, tapering fears from the Federal Reserves continue to loom over the next year so we are still taking a cautious outlook for 2022.


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