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 after bouncing from Friday’s lows – will they continue higher?
The S&P 500 index lost 0.28% on Tuesday as it retraced its intraday advance and a breakout above the 4,400 level. Yesterday’s daily high was at 4,418.59 and on Friday it was 271.76 points or 5.90% below the July 27 medium-term high of 4,607.07. Recently the market was selling off on strengthening U.S. dollar, among other factors.
Stocks will likely open 0.1% higher today. So the S&P 500 index may go sideways and along the 4,400 level. It is still trading below a month-long downward trend line as we can see on the daily chart:
Futures Contract Remains Close to 4,400
Let’s take a look at the hourly chart of the S&P 500 futures contract. This morning it is trading slightly above the 4,400 level. The nearest important support level is at around 4,380-4,400 and the resistance level remains at 4.450, among others.
Conclusion
The S&P 500 will continue to fluctuate along the 4,400 level. For now, it looks like an upward correction following the recent declines. However, on a longer time frame, the recent declines may have been just a downward correction within a medium-term uptrend.
Investors will be waiting for the important Fed Chair Powell’s speech at the Jackson Hole Symposium on Friday.
Here’s the breakdown:
- Stock prices fluctuate following their recent rebound.
- The S&P 500 will likely trade along the 4,400 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
