Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,140, 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 between 1.2% and 1.6% on Friday, extending their short-term fluctuations, as investors reacted to some further Greece debt deal news releases, among others. The S&P 500 index trades within a short-term consolidation, following its late June decline. The nearest important level of resistance is at around 2,080, marked by local highs. On the other hand, support level remains at 2,040-2,050, marked by March local lows:
Expectations before the opening of today's trading session are positive, with index futures currently up 0.6-0.8%. The main European stock market indexes have gained 0.7-2.1% so far. The S&P 500 futures contract (CFD) is within an intraday uptrend, following lower opening. The nearest important level of support is at 2,060-2,070, and resistance level is at 2,090-2,100, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) trades within a similar intraday uptrend, following lower opening. The nearest important level of resistance remains at 4,450, and support level is at 4,400-4,420, among others, as we can see on the 15-minute chart:
Concluding, the broad stock market extended its short-term consolidation on Friday. For now, it looks like a flat correction following a downtrend. Therefore, we continue to maintain our already profitable speculative short position (2,098.27, S&P 500 index), as we expect a medium-term downward correction or an uptrend reversal. Stop-loss is at 2,140, 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
