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 0.4% and 1.5% on Thursday, extending their short-term uptrend, as investors reacted to quarterly corporate earnings releases. The S&P 500 index got closer to its late May all-time high of 2,134.72. The nearest important resistance level is at around 2,130-2,135. On the other hand, level of support remains at 2,110-2,115, among others:
Expectations before the opening of today's trading session are mixed, with index futures currently between -0.1% and +0.3%. The European stock market indexes have been mixed so far. Investors will now wait for some economic data announcements: Consumer Price Index, Building Permits, Housing Starts at 8:30 a.m., Michigan Sentiment at 10:00 a.m. The S&P 500 futures contract (CFD) trades within an intraday consolidation, following recent rally. The nearest important level of resistance is at 2,120, and support level is at 2,100-2,110, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it fluctuates along record highs. The nearest important level of support is at around 4,600, as we can see on the 15-minute chart:
Concluding, the broad stock market slightly extended its short-term uptrend yesterday. However, we continue to maintain our 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
