<Part 3 of 5> outlook of S&P500 with 20+ indicators (13Oct25)

Market Outlook of S&P500 (13Oct25)

Technical observations:

• MACD analysis indicates a bearish trend.

• The Exponential Moving Averages (EMA) are aligned in an uptrend, which supports a bullish outlook. The 3 EMA lines are about to converge. This should imply a reversal from the current uptrend.

• Both the 50-period and 200-period Moving Averages (MA) are showing an uptrend, suggesting a bullish market sentiment in both the short and long term.

• The Chaikin Money Flow (CMF) is positive at 0.16, indicating an influx of buying volume over the last 20 periods.

Technical Analysis and Current Price Action

The S&P 500 closed at 6,552.51 on October 6, 2025, marking a sharp decline of -2.7% for the day. Technical analysis at the Daily interval recommends an overall Sell rating, with 12 indicators suggesting a sell signal versus 8 indicators suggesting a buy signal.

Candlestick Trend Analysis (using Grok & Gemini)

The recent price action saw an Engulfing Bearish pattern emerge, signalling a potential short-term reversal following a multi-week rally. While the chart shows a sharp decline supported by these fresh bearish signals, older, sustained bullish patterns suggest the market still possesses an underlying resilience.

Short-Term Outlook (1–4 Weeks)

The immediate outlook is Bearish due to a cluster of major risk factors. Volatility is anticipated, with a heightened chance of a pullback driven by geopolitical and policy concerns. The key downside risks include the possibility of new tariff implementations, the threat of a government shutdown, and growing scepticism about the long-term profitability and valuation of AI-related companies. While a minor bounce remains plausible if market sentiment shifts rapidly, a full reversal of the recent bearish move is considered unlikely.

Long-Term Outlook (3–12 Months)

The long-term outlook remains cautiously Bullish, treating the current decline as a healthy correction within a broader uptrend. This view is underpinned by strong bullish fundamentals, including solid economic growth and persistent corporate earnings potential, which should support modest gains by year-end. Potential upside could be driven by successful AI monetisation strategies and a favourable sector rotation toward small-cap and industrial stocks. However, significant fiscal risks remain a primary threat to the continued positive trajectory.

Combining the preceding analysis, the prevailing sentiment favours a bearish outlook, particularly given the unresolved geopolitical tension concerning the America-China tariff dispute. This lack of a resolution is a significant factor contributing to market uncertainty and downside risk.

@TigerStars

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