Tastylive: 30 Year Technical Trader Explains Why We Could Keep Going Up

With markets breaking higher, the stage has been set for a year-end rally. However, the question is how far markets go before the current rally pauses. That’s where technical analysis can come into play.

Technical indicators can provide a sense of when markets get heavily overbought. And where potential pivot points in the market lie. Those levels indicate where stocks may find resistance and pause before trending higher.

One way of determining how high markets can go is to use a channel to look at an asset. A channel looks at a market’s trend. A line is drawn at market peaks, and another at market lows. The extension of both those lines can give investors a sense of the range that a stock or market index is likely to trade in.

Sometimes, there’s a big market jump, or a big drop. Those can cause the creation of a new channel.

Looking at the current market channel for the S&P 500 index, it’s likely that the market can see another 200 point move, or another 3% higher, over the coming weeks.

Within a broad market uptrend, over the shorter-term, stocks can fluctuate wildly. So while the market trend is up into 2025, there will be some daily swings lower along the way.

To see some of the major channels and technical trends for the next few months, click here.