BTIG says stock market hasn’t bottomed, and may not until THIS level

The benchmark S&P 500 index inched lower on Mar. 19 as investors reacted to a missile strike on Qatar’s Ras Laffan industrial complex – a critical node in global energy infrastructure.

The attack sent energy prices soaring, reigniting fears of a systemic inflationary shock.

Meanwhile, the Fed’s “hawkish hold”, with officials signalling only one rate cut in 2026, crushed hopes of policy relief as well.

This combination of rising costs and restrictive monetary policy saw SPX slipping below its 200-day moving average (MA) for the first time in nearly a year – a technical setup that often suggests the long-term uptrend has been compromised.

And BTIG’s chief market technician Jonathan Krinsky agrees that this breach is significant, noting the market’s “underlying conditions” are indeed flashing warning signs.

According to him, repeated testing of these technical floors often precedes a sharper break, leaving the US stock market vulnerable to further downside as internal leadership continues to erode.  

How low could the S&P 500 sink in 2026?

While the 200-day MA is a key psychological marker, Krinsky sees 6,520 as the “more important” level for investors to watch.  

That level represents both the November and Q4 low (2025).

If the index fails to hold this support, it will signal a profound shift in market dynamics, he told CNBC.

Such a breakdown may “open the door” for a continued slide toward the 6,000 level – representing potential for another 9% decline from here.

Krinsky’s bearish view is supported by a lack of breadth within the index.

A failure to hold foundational floors across different sectors – including financials and consumer discretionary – suggests a “change in psychology” where buyers are no longer willing to defend the previous value zones.

Iran war resolution unlikely to be an ‘all clear’

Speaking with CNBC, Krinsky also argued that a diplomatic resolution or the end of the Iran war won’t prove an immediate “all clear” for US stocks.

While a positive development would likely trigger a “relief rally”, Krinsky remains skeptical of its sustainability.

Why? Because the market was showing signs of “exhaustion” even before US-Iran hostilities that eventually resulted in the Ras Laffan incident or the Strait of Hormuz closure.

Software stocks were seeing a massive sell-off, and indices like the Russell 3000 Growth had peaked as far back as late 2025.

In short, the market needs to resolve its internal valuation and growth concerns before a sustainable rally can materialize, he added.

What to expect from SPX moving forward?

All in all, with private credit concerns mounting and the banks beginning to buckle, the underlying foundation of the S&P 500 looks increasingly fragile.

Then of course, there’s the US central bank now signalling just “one rate cut” in 2026 – which has effectively dashed hopes for a liquidity-driven rescue and forced investors to confront a “higher-for-longer” reality amidst a volatile stagflationary backdrop.

Until the index can decisively reclaim its key moving averages and demonstrate improved sector participation, BTIG suggests the bottom remains elusive.

For now, the focus remains on the 6,520 level – a failure there would confirm that the 2026 market correction is only just beginning.