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): bearish
Long-term outlook (next year): bullish

Cash in your profits. Just like we did yesterday.

The main U.S. stock market indexes lost 3.6-3.8% on Monday, extending their recent move down, as investors reacted to global stock exchanges decline. The S&P 500 index broke below the level of 1,900, as it got closer to last October's low. Daily trading range has reached almost 100 index points, which is quite extraordinary. There have been no confirmed positive signals so far. The nearest important level of support is at around 1,870-1,900. On the other hand, resistance level is at 1,965-1,970, marked by yesterday's daily gap down:

Expectations before the opening of today's trading session are very positive, with index futures currently up 3.0-3.8%. The European stock market indexes have gained 3.1-4.3% so far. Investors will now wait for some economic data announcements: Case-Shiller 20-city Index, FHFA Housing Price Index at 9:00 a.m., New Home Sales, Consumer Confidence at 10:00 a.m. The S&P 500 futures contract (CFD) trades within an intraday uptrend, as it retraces yesterday's move down. The nearest important level of resistance is at around 1,950, marked by yesterday's local high, as the 15-minute chart shows:

The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it trades much higher this morning. The nearest important level of resistance is at 4,200, and support level is at 4,100, among others, as we can see on the 15-minute chart:

Concluding, the broad stock market extended its fast decline on Monday, as investors reacted to global stock markets sell-off. Our late April's short position's (2,098.27, S&P 500 index) profit target has been reached at the level of 1,980. Overall, we gained almost 120 index points on that pre-planned trade. We prefer to be out of the market at this moment, 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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