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).
The S&P 500 fluctuated on Friday after the jobs data – will it extend its downward correction?
The broad stock market index lost 0.29% on Friday as it fluctuated following the Thursday’s decline of 0.8%. On Thursday the market retraced its rally and it closed the previous Friday’s daily gap up. Last week it retraced all of its recent declines following economic data releases, among other factors. On Friday June 30 the index reached new medium-term high of 4,458.48.
There is still a lot of uncertainty concerning monetary policy, some technology stocks’ valuation concerns, but the investors’ sentiment remains bullish.
Stocks will likely open virtually flat today. So the S&P 500 may continue to fluctuate along the 4,400 level, as we can see on the daily chart:
Futures Contract Remains Above 4,400
Let’s take a look at the hourly chart of the S&P 500 futures contract. Recently it rallied up to the 4,500 level again and on Thursday it retraced some of that rally. The nearest important support level remains at 4,400-4,420 and the resistance level is at 4,480-4,500.
Conclusion
The S&P 500 index will likely extend its Thursday’s-Friday’s short-term consolidation. There have been no confirmed negative signals so far. For now it looks like a relatively flat correction within an uptrend. However, the market may see a more pronounced profit taking action at some point.
Here’s the breakdown:
- The S&P 500 continues to trade along the 4,400 level.
- There have been no confirmed negative signals, however, a downward correction may be in cards.
- 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).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
