FxWirePro: S&P500 likely to reach new record high if support at 2530 holds

Global stock markets selloff that was triggered in last weeks of January rattled investors’ nerves for two weeks and still continues to do so. We at FxWirePro were already bearish in Eurostoxx50 before the selloff even took place after it, we also revised our outlook for the German benchmark stock index DAX earlier this month. We have also turned bearish on Spanish benchmark INEX35 as well as the UK benchmark FTSE100. While we have turned bearish on European stocks that is not the case when it comes to the United States.

The U.S. stocks are being supported by Trump administration’s tax cuts and reforms, while the European benchmarks don’t have that leverage.

Our calculations for the S&P500 suggests that the Dow is set to hit new record highs in the coming months if the crucial support at 2530 area holds, which has already supported stocks once during the global stock markets selloff. The upbeat growth outlook in the United States is likely to support the U.S. benchmarks. Calculations suggest that the S&P500 is set to reach 2920 area if the above-mentioned support holds.