Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): No positions are currently justified from the risk/reward point of view.
Stocks pulled back a little yesterday. There’s still no clear short-term direction - is this a topping pattern?
The S&P 500 index lost 0.16% on Tuesday, as it slightly extended its Monday’s decline of 1.5%. The broad stock market’s gauge retraced most of last week’s advances on a renewed interest rates’ uncertainty, among other factors. On Friday the index reached a local high of 4,034.02, and yesterday it went to the daily low of 3,937.65. Stock prices have been fluctuating since a rally that took place on November 10.
This morning the S&P 500 is expected to open 0.1% lower following some mixed economic data releases. The market will be waiting for today’s speech from the Fed Chief Powell at 1:30 p.m.
Futures Contract Keeps Going Sideways
Let’s take a look at the hourly chart of the S&P 500 futures contract. It is still trading relatively close to the 4,000 level. The resistance level remains at 4,000-4,050.
In our opinion, no positions are currently justified from the risk/reward point of view.
Conclusion
The S&P 500 will likely open virtually flat this morning. The market may extend its short-term consolidation along the 4,000 level. There have been no confirmed negative signals so far. It looks like a correction or a consolidation within an uptrend.
Here’s the breakdown:
- The S&P 500 index got back to the 4,000 level yesterday; it may extend a consolidation ahead of series of economic data releases.
- It still looks like a flat correction within an uptrend.
- In our opinion, the short-term outlook is neutral.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): No positions are currently justified from the risk/reward point of view.
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
