Technically Speaking – January

January 6, 2026

Long Term Resistance SP500:  6950

Long Term Support SP500:   6545 then 6350

The markets ended 2025 volatile with no real Christmas rally like we have historically seen. This was due to multiple factors including investors being cautious coming into the new year after watching the S&P have 8 straight positive months. Another reason could be from tax loss harvesting towards the end of the month from investors who took profits from tech stocks after we hit highs in October. Investors continue to look at what the Fed says and projects for the coming year. At their last meeting, the Fed cut rates by another 25 basis points and are projecting one more 25 basis point rate cut during 2026.

The S&P 500 still has a long-term resistance level of 6,950 and if it breaks through that level, we can see the S&P hit 7,000 for the first time. IF the Fed changes its tune or the geopolitical environment changes, then we could see the markets correct and, at that point, the next long-term support level for the S&P is 6,350. January is usually a positive month with the most money being invested through new 401k contributions for the new year. My view of the market has not changed in the last couple months, and I am going to continue being cautiously optimistic for January.

There are always individual opportunities that present themselves in any market conditions, which is why we use an active management approach. But I believe right now is not the time to be ultra-aggressive. Continue being invested in the markets but if you are getting nervous of the markets increase, then it might be time to rebalance your portfolio to take some profits from winners and either keep the cash on the side or invest in the safe side of your portfolio.