According to Art Cashin of UBS, the S&P 500 is trading in a narrow range that could soon give way to a major move in either direction. The veteran stock trader said on CNBC’s “Squawk on the Street” that the market was bouncing between key areas of resistance and support. “This is a market that is taking its pulse, and taking its temperature,” Cashin said. The S&P 500 was down slightly on Wednesday after closing around 4,160 in the previous session. Cashin pointed to the 4,175 level as an upside resistance level for the market. “If we go through there, there is a more significant resistance at 4,200,” he said. Beneath that, Cashin highlighted 4,080 and 4,050 as key downside support levels. Tuesday’s intraday low for the index was 4,080. Many traders use resistance levels and technical indicators as markers of potential breakout moves for stocks, whether up or down. “In each case, traders will look to see if things like algorithmic come up. Do these levels act as triggers? Once they are pierced, is it cascade selling, or short covering instead? brings,” Cashin said. Over the long run, Cashin believes stocks could struggle as investors and companies come to terms with a slump in earnings. “You’re already seeing that analysts are starting to mark up some earnings, and I think you’re going to get, maybe not a Target-like surprise, but I think we’ll be able to mark the end of the month.” And see you as a start. Next month you’ll see companies changing their guidance,” Cashin said.
