Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are currently justified from the risk/reward point of view (since Feb. 27 before session’s open).
Stocks rallied on Friday – will the uptrend continue? Or was it just a rebound?
The S&P 500 index gained 1.61% on Friday, as it retraced more of the recent declines following Thursday’s rebound from the local low of 3,928.16. On Friday the daily high was at 4,048.29, so in just two days the market gained 120 points. Recently stocks were selling off on interest rate, Russia-Ukraine war fears, among other factors.
The S&P 500 index is expected to open 0.3% higher and stocks will further extend their short-term uptrend. On Friday the index went the highest since February 21, as we can see on the daily chart:
Futures Contract Fluctuates Along New Highs
Let’s take a look at the hourly chart of the S&P 500 futures contract. On Friday it broke above the 4,000 level, before accelerating the uptrend up to the resistance level of around 4,050-4,060. The next resistance level is at 4,080-4,100.
Conclusion
Stocks prices will likely extend their short-term uptrend this morning. However, we may see a profit-taking action at some point, as the market seems overbought in the short-term. There have been no confirmed negative signals though.
Here’s the breakdown:
- The S&P 500 rebounded on Thursday and Friday and this morning it will further extend the uptrend.
- Stocks retraced their recent declines, however, it still may only be a rebound and a correction within a downtrend.
- 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 currently 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
