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).
Stocks bounced from new lows on Friday – will downtrend reverse?
The S&P 500 index lost 0.01% on Friday after bouncing from new medium-term low of 4,335.31. 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 0.3% higher this morning. So the S&P 500 may extend its Friday’s rebound. It remains below a month-long downward trend line as we can see on the daily chart:
Futures Contract Is Closer to 4,400
Let’s take a look at the hourly chart of the S&P 500 futures contract. This morning it’s trading along the 4,400 level. The nearest important support level is now at around 4,380 and the resistance level is at 4.400-4,420, among others.
Conclusion
The S&P 500 will open slightly higher this morning. The market may extend its fluctuations following the recent selloff. Investors will be waiting for Wednesday’s PMI releases and Friday’s speech from the Fed Chair Powell at the Jackson Hole Symposium.
Here’s the breakdown:
- Stocks bounced from new lows on Friday; the market may have reached a short-term bottom.
- The S&P 500 remains below 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
