Two key levels on the S&P 500 will signal where it heads next

For all the talk of a trade war and an eager-to-hike Fed, markets haven��t moved much this summer. The S&P 500 is now back to where it was in mid-May.

Two key levels could bring about the next big swings on the S&P 500, says one market watcher.

��On the resistance level it��s the 2,800 level. That��s where we topped out in February, March and in June of this year,�� Matt Maley, equity strategist at Miller Tabak, told CNBC��s ��Trading Nation�� on Thursday.

The benchmark index moved as high as a record 2,872 in late January before falling back in early March. It bumped up against 2,800 again in mid-March but failed to hold the level.

��If we can break above that, that��s going to give a lot of upside momentum to the market and we should see a quick move up to the all-time highs. That��s going to be very bullish,�� Maley said.

One level of support lies at its 100-day moving average of 2,705, says Maley. The S&P briefly touched that level in intraday trading in early July, but mostly held above it.

��The more important level, of course, is the 200-day moving average. It is one it��s bounced off of several times this year,�� Maley said. ��You break below that and I think it��s going to be a quick move down to the intraday lows of February.��

The S&P 500 currently trades 2 percent above its 200-day moving average of 2,679. It last broke that trend line in early May.

The risks to the S&P 500 are intensifying, says Boris Schlossberg, managing director of FX strategy at BK Asset Management. He sees the largest headwind in the trade conflict with China.

��The kind of very negative geopolitical implications of a trade war �� could have very long-term ramifications that could basically destroy a lot of this recovery, so I think it��s a touch-and-go situation,�� Schlossberg said on Thursday��s ��Trading Nation.�� ��Until the political situation is kind of resolved and we have some clarity, it��s difficult to make a strong case for equities.��

The U.S. hit China with its first round of tariffs early Friday and has threatened more to come. The Trump administration has imposed tariffs on $34 billion worth of Chinese goods and China immediately retaliated with similar tariffs on U.S. goods.

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