Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
Stock prices fluctuate despite important economic data – which direction is next?
The S&P 500 index gained 0.12% on Wednesday following the Consumer Price Index release. It continued to trade along the 4,450 level. Recently the market retraced more of the early September declines after bouncing from last week’s local low of around 4,430. There’s still a lot of uncertainty about monetary policy and economic growth. Stock prices continue to move sideways after their advances from March to July.
The S&P 500 will likely open 0.3% higher this morning after a series of economic data releases, including higher than expected producer inflation number. The index continues to trade below the 4,500 level as we can see on the daily chart:
Futures Contract Extends a Consolidation
Let’s take a look at the hourly chart of the S&P 500 futures contract. It is still trading along the resistance level of around 4,540. On the other hand, the support level is now at 4,500.
Conclusion
Stocks will likely continue to fluctuate this morning. The market remains close to its local highs, so there may be an attempt at breaking higher at some point.
Recently the investors’ sentiment improved as the pressure for further monetary policy tightening somewhat eased. But stocks retraced most of their late August rally after bouncing off their mid-July local lows resistance level.
Here’s the breakdown:
- Stock prices will likely extend a consolidation this morning.
- The S&P 500 remains relatively close to the 4,500 level.
- In my opinion, the short-term outlook is still bullish and long positions are still justified from the risk/reward point of view.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
