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
The main U.S. stock market indexes gained 0.1-0.3% on Monday, extending their short-term fluctuations. Our yesterday's neutral intraday outlook has proved accurate. The S&P 500 index continues to trade above the level of 2,000. The nearest important level of resistance is at 2,020-2,050, marked by March - August consolidation, among others. On the other hand, support level remains at 1,970-2,000. There have been no confirmed medium-term positive signals so far. It still looks like a correction following late August sell-off:
Expectations before the opening of today's trading session are negative, with index futures currently down 0.4-0.5%. The European stock market indexes have lost 0.8-1.4% so far. The S&P 500 future contract (CFD) is within an intraday downtrend, as it retraces yesterday's advance. The nearest important level of support is at 1,990-2,000, marked by previous resistance level. On the other hand, level of resistance is at 2,010-2,015, marked by local highs, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) remains within a similar intraday downtrend, as it trades along the level of 4,350 this morning. The nearest important level of resistance is at around 4,360-4,370, marked by local highs, and support level is at 4,340-4,350, as we can see on the 15-minute chart:
Concluding, the broad stock market remained within a short-term consolidation on Monday, extending its Friday's uncertainty. There have been no confirmed medium-term positive signals so far. It continues to look like a consolidation or a flat correction following late August sell-off. Our late September long position (1,881.9 S&P 500) has been closed at the level of 2,013.73 on Friday. Overall, we gained around 131.83 index points on that trade. As of this morning, we 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
Stock Trading Alerts
