#INDICES April 2023 Forecast: #SP500, #NASDAQ
NASDAQ 100 Forecast: April 2023
Pay attention to the Federal Reserve, because it looks like they are getting somewhat close to the end of their hiking cycle, but they also plan on staying tight for quite some time.
- The NASDAQ 100 has been trading and arranging for the last couple of months, and the month of April could very well see the same. It does look like at the very least the buyers are trying to make some noise in this market.
- However, it’s not until the market breaks above the 14,000 level that one can say that we have truly chewed through a major area of resistance.
- While the 13,000 level of course has been the one area that we have tested multiple times over the last couple of months, it’s worth noting that we recently had a bit of a “throw over” to reach the 14,000 level.
If we turn around and break down from here, is very likely that we could go down to the 12,000 level, maybe even down to the 11,000 level. This is more likely than not going to be an area that continues to hold, but if we were to break down below 10,500, then the market could really fall apart at that point, testing the 10,000 level. The 10,000 level obviously would be a psychologically important barrier, and anything that breaks the market below there could really send it into a tailspin.
Wall Street “group think” dictates that some of the bigger stocks in the NASDAQ 100 continue to be favorites of fund managers, regardless of how they perform. With that being the case, I think this is a market that is more likely than not going to go sideways for the month than anything else, but I do favor fading rallies as we continue to see a lot of overhead problems. While I favor fading rallies that show signs of exhaustion, I also recognize that during the month of April, we will probably see a couple of short-term oversold conditions that send the market back to the upside. In general, this looks like a market that is going to stay basically where it’s at, and I don’t expect a whole lot of momentum unless, of course, we get some type of big macroeconomic event.
Pay attention to the Federal Reserve, because it looks like they are getting somewhat close to the end of their hiking cycle, but they also plan on staying tight for quite some time. Perhaps it’s much longer than the Wall Street traders believe, so with that being the case, it could cause quite a bit of a headache for the bulls.
S&P 500 Forecast: April 2023
The market continues to pay close attention to the 4100 level, and then of course the 4200 level after that.
- The S&P 500 has been very noisy over the last couple of weeks, and there’s almost no chance that April is going to be any different.
- The choppiness is a good representation of all of the economic uncertainty that we have around the world, and therefore it should not be overly surprising to see that perhaps we may drift sideways more than anything else.
- However, I also recognize that there seems to be more hesitant to jump into the market with both feet, so I do think that the downside has more strength than the upside.
Another thing to keep in mind is that as we enter April, we are entering a timeframe in which companies cannot step into the market to buy their own shares, so there will be that artificial bottom. Furthermore, there are a lot of concerns when it comes to the global economy, and therefore I think you continue to see plenty of sellers willing to jump on the first signs of exhaustion.
The market continues to pay close attention to the 4100 level, and then of course the 4200 level after that. The market reaching that area does make a lot of short sellers interested, and therefore I think we will struggle to get above there. However, it must be said that if we were to break above the 4200 level, it could open the possibility of a bigger move to the upside, perhaps all the way to the 4400 level.
On the other hand, if we can break down below the 3800 level, then it’s likely that the S&P 500 breaks down quite significantly, perhaps sending the market all the way down to the 3600 level. The 3600 level was a major swing low, therefore if we can break down below that level, then it opens a freefall where the S&P 500 could collapse for a much bigger move.
All things being equal, I think this is a market that is more likely than not going to see a lot of choppiness over the next month, so I’m not necessarily looking for a meltdown. I do think that every time we rally, it does make a certain amount of sense that we continue to see hesitation to send this market higher anytime soon, especially if the Federal Reserve remains resilient with its tight monetary policy.
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