The S & P 500 is trading in a tight range that could soon give way to a sizable move in either direction, according to UBS’ Art Cashin. CNBC’s Squawk on The Street interviewed the veteran stock trader to say that the market bounced between areas of support and resistance. Cashin stated, “This market is taking its pulse and taking it’s temperature.” The S & P 500 was down slightly on Wednesday after closing around 4,160 in the previous session. Cashin identified the 4,175 mark as an upside support level for the market. Cashin stated, “If you push through there there is greater resistance at 4,200.” Cashin, below that level, highlighted 4,080 (support levels) and 4,050 (support levels). The index’s intraday lowest was at 4,080 on Tuesday. Many traders look for resistance levels or technical indicators to indicate a possible breakout in stocks. The algorithms will be used to help traders determine whether they are successful in each situation. Are these levels triggers? Cashin stated that once they are pierced, will this bring about cascade sales or rather short covering? Cashin is concerned that stocks may struggle in the long-term as companies and investors come to an agreement on slowing earnings growth. Cashin stated that analysts are already marking down earnings and that he believes you will see more companies changing their guidance as they get closer to the end and beginning of next months.
