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 before session’s open).
The stock market rallied on Friday as the S&P 500 broke above 4,100 – will the uptrend continue?
The S&P 500 index gained 1.44% on Friday, as it extended a short-term uptrend after its Wednesday’s-Thursday’s advances. The sentiment improved on the last trading day of a month and a quarter. The index was the highest since February 16. It keeps advancing from the March 13 local low of 3,909.16.
Stocks will likely open 0.2% lower this morning. The market may fluctuate following its last week’s rally. The S&P 500 is now within its early February topping pattern, and below the important resistance level of 4,200 as we can see on the daily chart:
Futures Contract Trades Within a Consolidation
Let’s take a look at the hourly chart of the S&P 500 futures contract. This morning it’s trading within a consolidation. The resistance level is at around 4,150, and the support level is now at 4,100-4,120.
Conclusion
Stocks extended their short-term uptrend on Friday and this morning we’ll likely see a profit taking action. So the market may fluctuate or retrace some of the advance. There have been no confirmed negative signals so far. However, there are some short-term overbought conditions.
Here’s the breakdown:
- Stocks are expected to open slightly lower following their last week’s advance.
- The S&P 500 went the highest since mid-February; there may be a profit-taking action and a consolidation.
- In my opinion, the short-term outlook is bullish and long positions are 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 before session’s open).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
