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).
Stock prices fluctuate following the CPI release – will they break above the previous highs?
The S&P 500 index gained 0.45% on Wednesday as it fluctuated above the 4,100 level following the consumer inflation number release. Last week on Thursday it fell to the local low of 4,048.28 and on Friday it went back to around 4,150. Yesterday it got closer to its last Monday’s medium-term local high of 4,186.92.
Stocks are expected to open 0.1% lower this morning, so the market will likely extend its consolidation. Recently the S&P 500 bounced from the important 4,200 resistance level as we can see on the daily chart:
Futures Contract Trades Along 4,150
Let’s take a look at the hourly chart of the S&P 500 futures contract. It is extending a consolidation along the 4,150 level this morning. The nearest important resistance level remains at around 4,160-4,200, and the support level is 4,120, among others.
Conclusion
The S&P 500 index is expected to open relatively flat this morning. Stocks will likely extend their short-term consolidation despite the recent economic data releases. It still looks like a consolidation after March-April advances.
Here’s the breakdown:
- The S&P 500 continues to trade within a consolidation; there’s still no clear direction following recent data releases.
- The market extends a few-week-long consolidation.
- In my opinion, the short-term outlook is 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
