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 S&P 500 index continues to fluctuate, so is it forming a bottom?
The broad stock market index lost 0.73% on Wednesday, but it bounced from the daily low of 3,838.24 and at the close it was above 3,890. So the market continues to fluctuate following its recent sell-off. Of course, it’s all about the banking crisis, and the economic data releases don’t matter that much anymore.
On Monday the index reached new local low of 3,808.86, and it was the lowest since January 5. Stocks extended their downtrend this week on more news about the troubled Silicon Valley Bank (SIVB) and the other U.S. banks’ situation.
This morning the S&P 500 will likely open 0.3% lower. The index may further extend its consolidation along the 3,900 level as we can see on the daily chart:
Futures Contract Trades Above 3,900
Let’s take a look at the hourly chart of the S&P 500 futures contract. It is still trading sideways and along the 3,900 level. The support level is at 3,850, among others, and the resistance level remains at 3,980-4,000 (June S&P futures contract).
Conclusion
Stock prices are expected to open slightly lower this morning. They may see more sideways trading action following the recent declines. The market may be forming a short-term bottom here, however, there have been no confirmed positive signals so far.
Here’s the breakdown:
- The S&P 500 continues to fluctuate following the banking crisis sell-off; it may be forming a short-term bottom.
- 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
