Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,210, and profit target at 2,050, S&P 500 index).

Our intraday outlook is bearish, and our short-term outlook is bearish. Our medium-term outlook is neutral, following S&P 500 index breakout above last year's all-time high:

Intraday outlook (next 24 hours): bearish
Short-term outlook (next 1-2 weeks): bearish
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): neutral

The U.S. stock market indexes lost 0.1-0.2% on Thursday, extending their short-term consolidation, as investors hesitated following economic data releases, among others. The S&P 500 index trades close to resistance level of 2,150. The next resistance level is at 2,170, among others. On the other hand, level of support is at 2,115-2,120, marked by previous local lows. The market continues to trade along medium-term upward trend line, as the daily chart shows:

Expectations before the opening of today's trading session are negative, with index futures currently down 0.2-0.4%. The main European stock market indexes have been mixed so far. The S&P 500 futures contract trades within an intraday consolidation following yesterday's fluctuations. The nearest important level of resistance is at around 2,140-2,150. On the other hand, support level is at 2,120-2,130, marked by some recent local lows, as we can see on the 15-minute chart:

The technology Nasdaq 100 futures contract is relatively stronger, following better-than-expected quarterly earnings releases. It currently trades within an intraday consolidation along the level of 4,840. The nearest important support level remains at around 4,800-4,820, marked by recent local low, among others. On the other hand, level of resistance is at 4,840-4,850, and the next resistance level is at 4,880-4,900, marked by an all-time high:

Concluding, the broad stock market extends its short-term consolidation, as the S&P 500 index trades along the resistance level of 2,150. There have been no confirmed positive signals so far. Therefore, we continue to maintain our speculative short position (opened on July 18th at 2,162, S&P 500 index). Stop-loss level is at 2,210 and potential profit target is at 2,050 (S&P 500 index). You can trade S&P 500 index using futures contracts (S&P 500 futures contract - SP, E-mini S&P 500 futures contract - ES) or an ETF like the SPDR S&P 500 ETF - SPY. It is always important to set some exit price level in case some events cause the price to move in the unlikely direction. Having safety measures in place helps limit potential losses while letting the gains grow.

Thank you.

Paul Rejczak
Stock Trading Strategist
Stock Trading Alerts