Despite uncertainty surrounding China, collapsing commodities and an impending rate hike, one technician says he sees the market hitting new highs by year-end.
"We have not seen such a tight market, despite such turbulence that we've seen in the global economy, in some time. This market is showing an incredible amount of resilience," Todd Gordon said Wednesday on CNBC's "Power Lunch."
China's Shanghai composite index has been bumpy in recent months as the country's economy slows, and has lost more than 4 percent this week. Commodities such as gold and crude oil have traded near multiyear lows in the past month.
U.S. stocks saw a strong selloff Wednesday morning, but rebounded temporarily after minutes from July's Federal Reserve meeting suggested further delays to raising interest rates. The Dow Jones industrial average and the both closed down almost 1 percent.
Gordon said the S&P continues to trade in a tight range above previous support levels. He said he sees the index reaching above 2,200 by the end of the year. The S&P has risen about 1 percent year to date, and closed Wednesday at 2,079.
"Just the fact that we haven't broken down with so much turbulence is suggesting that that logical approach will emerge," he said.
Larry McDonald, managing director at Societe Generale, is not as bullish.
He said Wednesday that the biggest challenge facing the U.S. stock market is turmoil in China and potential credit defaults. He compared this situation to risk from emerging markets in 1998, in which the S&P 500 dropped 22 percent from July to September.
"The Chinese slowdown is impacting the many markets around the world, and that is presenting a risk to the U.S.," McDonald said. "U.S. equity rallies are suspect until we see a meaningful improvement in credit."
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