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 extends its consolidation, will stock prices break higher at some point?
The S&P 500 index lost 0.17% on Thursday as it basically went sideways following Wednesday’s CPI and Thursday’s PPI releases. Last week on Thursday it fell to the local low of 4,048.28 and on Friday it went back to around 4,150. On Wednesday it got closer to its last Monday’s medium-term local high of 4,186.92.
Stocks will likely open 0.3% higher this morning. So the S&P 500 may see an attempt at breaking above the recent high. In early May the index bounced from the important 4,200 resistance level as we can see on the daily chart:
Futures Contract Trades Slightly Above 4,150
Let’s take a look at the hourly chart of the S&P 500 futures contract. It continues to trade along the 4,150 level this morning. The nearest important resistance level remains at around 4,160-4,200, and the support level is at 4,120, among others.
Conclusion
The S&P 500 index will likely extend its short-term consolidation following last Friday’s rebound. Stock prices continue sideways despite the recent economic data releases. It still looks like a consolidation after March-April advances.
Here’s the breakdown:
- The S&P 500 extends its consolidation; there’s still no clear direction following recent data releases.
- The market extends a few-week-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
