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).
Stocks fluctuate following their recent rally – is this just a flat correction?
The S&P 500 index lost 0.25% on Wednesday as it retraced some of the recent rally. On Tuesday it reached new medium-term high of 4,133.13. The index was the highest since February 16. Recently the S&P 500 was advancing from the March 13 local low of 3,909.16.
Stocks are expected to open 0.2% lower this morning. The S&P 500 index may extend its consolidation below the 4,100 level. For now it looks like a correction within an uptrend. The broad stock market remains 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 Remains Above 4,100
Let’s take a look at the hourly chart of the S&P 500 futures contract. It retraced some of the recent advances, as it went closer to the 4,100 level. The resistance level remains at 4,150-4,170 and the support level is at 4,100, among others.
Conclusion
The S&P 500 index retraced some of the recent advances yesterday, however, it only looks like a correction within an uptrend. Stocks are expected to open slightly lower this morning, and they will likely extend a consolidation before a long holiday weekend.
Here’s the breakdown:
- Stock prices go sideways following the recent rally; for now it looks like a consolidation within an uptrend.
- In my opinion, the short-term outlook is 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 before session’s open).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
