Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,150 and profit target at 1,980, S&P 500 index)
Our intraday outlook is bearish, and our short-term outlook is bearish:
Intraday outlook (next 24 hours): bearish
Short-term outlook (next 1-2 weeks): bearish
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): bullish
The U.S. stock market indexes gained 0.3-0.8% on Monday, retracing some of their last week's move down. The S&P 500 index remains in a downward correction, following February move up. The nearest important level of support is at around 2,065-2,070, marked by previous local extremes. On the other hand, resistance level is at 2,085-2,100, marked by some recent local lows, as we can see on the daily chart:
Expectations before the opening of today's trading session are negative, with index futures currently down 0.6-0.7%. The main European stock market indexes have lost 0.6-0.7% so far. Investors will now wait for some economic data announcements: JOLTS - Job Openings number, Wholesale Inventories at 10:00 a.m. The S&P 500 futures contract (CFD) is in an intraday downtrend, as it trades below yesterday's low. The nearest important resistance level is at around 2,070-2,080. On the other hand, potential support level is at 2,060:
The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it trades below yesterday's low. The nearest important support level is at 4,380, and level of resistance remains at 4,440-4,420, among others, as the 15-minute chart shows:
Concluding, the broad stock market retraced some of its recent move down on Monday. We continue to maintain our speculative short position (opened on February 18 at 2,099.16, S&P 500 index), as we expect downward correction or an uptrend reversal. Stop-loss is at 2,150, and potential profit target is at 1,980. You can trade S&P 500 index using futures contracts (S&P 500 futures contract - SP, E-mini S&P 500 futures contract - ES) or an ETF like the SPDR S&P 500 ETF - SPY. It is always important to set some exit price level in case some events cause the price to move in the unlikely direction. Having safety measures in place helps limit potential losses while letting the gains grow.
Thank you.
Paul Rejczak
Stock Trading Strategist
Stock Trading Alerts
