The S&P 500 has fallen somewhat hard during the trading session on Monday again, as we continue to see a lot of concern around the world. With that being the case, I think it does make a certain amount of sense that we go looking towards the 4200 level next. After that, we could be looking at an attempt to break down below the 200 day EMA, maybe even opening up a move down to the 4100 level.

S&P 500 Video 05.10.21

Rallies at this point will be ignored by myself, unless of course we take out the 50 day EMA. Currently, the 50 day EMA is sitting at the 4400 level, and therefore I think getting above that level is paramount to saving the uptrend. At this point, I more likely to buy puts than anything else, because it is so obvious that the Federal Reserve pays close attention to this index. With this, it is only a matter of time before they would either jawbone the index back to the upside or come into the bond market and start throwing money at the issue.

Regardless, this is a market that I think desperately needs some type of pullback, and so far, it is still relatively healthy. Because of this, I think it is only a matter of time before we see buyers coming in based upon value, but I do not know that we are there quite yet. Quite frankly, the price action on the intraday chart on Monday has been horrible, not suggesting that we are done quite yet.

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