Briefly: In our opinion, no speculative positions are justified.
Our intraday outlook is neutral, and our short-term outlook is neutral:
Intraday outlook (next 24 hours): neutral
Short-term outlook (next 1-2 weeks): neutral
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): bullish
The main U.S. stock market indexes lost between 0.3% and 0.5% on Monday, retracing some of last week's move up, as investors reacted to quarterly corporate earnings releases, among others. The S&P 500 index remains close to resistance level of 2,100-2,120, marked by February 25 all-time high of 2,119.59. On the other hand, level of support is at 2,070-2,080, marked by recent local lows. There is no clear medium-term direction, as stocks extend their three-month long fluctuations along the level of 2,050-2,100:
Expectations before the opening of today's trading session are negative, with index futures currently down 0.3%. The European stock market indexes have lost 0.2-0.6% so far. Investors will now wait for some economic data announcements: Retail Sales, Producer Price Index at 8:30 a.m., Business Inventories at 10:00 a.m. The S&P 500 futures contract (CFD) trades below its yesterday's low. The nearest important level of resistance remains at around 2,090-2,100. On the other hand, support level is at 2,065-2,075, marked by recent consolidation, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it trades below yesterday's low. The nearest important level of resistance remains at around 4,415, and support level is at 4,370, among others, as we can see on the 15-minute chart:
Concluding, the broad stock market retraced some of its recent move up on Monday, as investors reacted to quarterly corporate earnings releases, among others. For now, it looks like further medium-term consolidation, following last year's October-November rally. We still prefer to be out of the market, avoiding low risk/reward ratio trades. We will let you know when we think it is safe to get back in the market.
Thank you.
Paul Rejczak
Stock Trading Strategist
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