J.P. Morgan urges caution as S&P 500 tests key support levels

What happened

J.P. Morgan's technical strategist Jason Hunter said the S&P 500 is testing key price levels and could fall sharply if it breaks below 7500. The index fell below 7600 and tested 7507, the low of its September trading range.

Confirmed

Global impact / market context

If the S&P 500 breaks below 7500, J.P. Morgan expects selling pressure, volatility, which means bigger price swings, and correlation, which means stocks moving together, to rise sharply. That can force investors to sell more to cut risk, pushing prices lower and raising borrowing costs for companies.

Analyst inference

Concerns about heavy AI spending and when it will produce returns hurt big technology stocks such as Alphabet and Intel, contributing to an October selloff. The S&P 500 ended October down 0.9%, while the Nasdaq had its biggest monthly decline since March 2025.

Analyst inference

What to watch

1. Watch whether the S&P 500 holds the 7507 level, the September trading-range low that Hunter calls a critical threshold for the market since early summer. Confirmed
2. Watch for a bottoming process, in which prices stop falling and stabilize, or capitulation, in which holders sell in a rush, before J.P. Morgan becomes less cautious on stocks. Proposed
3. If the S&P 500 falls below 7500, watch the 7237-7313 zone as the next support area, with 6900-7100 possibly acting as a fourth-quarter floor. Analyst inference

Evidence

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