BTIG analysts assume the fall of S&P 500 to 3,400 is «probably necessary for capitulation».
«We do not think that 3,589 points will be a minimum, and we predict a possible jump to 3,400 before a more solid minimum is formed», — they told clients in a note.
Similarly, Bank of America analysts noted that the S&P 500 ended September with marks below its declining 12-month moving average around 4256. «This corresponds to the transition of SPX in the range from 3,450 to 3,220», — they said.
Furthermore, the index closed below the ascending 200-week moving average, which is likely to increase pressure from sellers this week. Analysts urge investors to pay closer attention to the following trading levels: a 50 percent rollback from March 2020 to January 2022 is near to 3,500, a lower projection is at a minimum of 3,400 and a 61.8 percent rollback is around 3,200.