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 FOMC release led to another decline of the S&P 500 – is this a new downtrend?
The S&P 500 index lost 0.70% on Wednesday as it extended its Tuesday’s decline of 1.2% following the FOMC Rate Decision release and the Fed Chair Powell’s Press Conference. The index retraced most of its last week’s advance and it broke below the 4,100 level. On Monday the S&P 500 was the highest since February 2 and on Tuesday investors reacted negatively to renewed fears about the banking crisis, among other factors.
Stocks are expected to open 0.2% lower this morning. So the index will fluctuate below the 4,100 level. Investors will be waiting for the important quarterly earnings release from AAPL – today after the session’s close. The S&P 500 bounced from the important 4,200 resistance level again as we can see on the daily chart:
Futures Contract Remains Close to 4,100
Let’s take a look at the hourly chart of the S&P 500 futures contract. It went back to the support level of 4,080 yesterday. On the other hand, the resistance level remains at 4,160-4,200.
Conclusion
The S&P 500 index will likely fluctuate following its Tuesday’s-Wednesday’s sell-off. The market will be waiting for the quarterly earnings release from AAPL and tomorrow’s monthly jobs data release. For now it looks like a further consolidation following March-April advances.
Here’s the breakdown:
- The S&P 500 came back below the 4,100 level following the FOMC release.
- The market extends its few-weeks-long consolidation.
- 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
