Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
S&P 500 remains close to 4,500 – will the uptrend resume?
The S&P 500 index lost 0.42% on Tuesday as it continued to fluctuate along the 4,500 level. Recently stock prices were rallying on worse than expected economic data and reduced pressure for the further monetary policy tightening. On previous Friday the index bounced from the local low of around 4,356 despite a hawkish speech from the Fed Chair Powell.
Stocks are expected to open 0.3% lower today. So the S&P 500 may see some more short-term uncertainty. The index remains close to the 4,500 level as we can see on the daily chart:
Futures Contract Trades Below 4,500
Let’s take a look at the hourly chart of the S&P 500 futures contract. This morning it’s trading slightly below the 4,500 level. The resistance level is now at around 4,520, marked by the short-term local high.
Conclusion
The S&P 500 will likely remain below the 4,500 level this morning. Recently the investors’ sentiment improved as the pressure for further monetary policy tightening somewhat eased. But stocks may extend a consolidation along their mid-July’s local lows. Investors will be waiting for the important ISM Services PMI release at 10:00 a.m.
Here’s the breakdown:
- Stock prices may extend their short-term consolidation.
- The S&P 500 will likely fluctuate along the 4,500 level.
- In my opinion, the short-term outlook is still bullish and long positions are still justified from the risk/reward point of view.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
