Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,140, and profit target at 1,980, S&P 500 index)
Our intraday outlook is bearish, and our short-term outlook is bearish:
Intraday outlook (next 24 hours): bearish
Short-term outlook (next 1-2 weeks): bearish
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): bullish
The U.S. stock market indexes were mixed between 0.0% and +0.5% on Thursday, as investors continued to hesitate following recent rally. The S&P 500 index remains close to its all-time high, as it extends its fluctuations along the level of 2,130. The nearest important level of resistance is at around 2,130-2,135. On the other hand, support level is at 2,115-2,120, marked by previous resistance level. There have been no confirmed negative signals so far. However, we can see negative technical divergences:
Expectations before the opening of today's trading session are virtually flat. The main European stock indexes have been mixed so far. Investors will now wait for the Consumer Price Index release at 8:30 a.m. The S&P 500 futures contract (CFD) trades within an intraday consolidation, following yesterday's move up. The nearest important level of support is at around 2,120-2,125, and resistance level is at 2,130-2,135, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) fluctuates in a relatively narrow range, as it trades along the level of 4,530. The nearest important resistance level is at 4,540-4,550, and level of support is at 4,500-4,520, as we can see on the 15-minute chart:
Concluding, the broad stock market remains within a short-term consolidation, following recent advance. There have been no confirmed negative signals so far. However, we continue to maintain our speculative short position (2,098.27, S&P 500 index), as we expect a downward correction or an uptrend reversal. Stop-loss is at 2,140, and potential profit target is at 1,980. You can trade S&P 500 index using futures contracts (S&P 500 futures contract - SP, E-mini S&P 500 futures contract - ES) or an ETF like the SPDR S&P 500 ETF - SPY. It is always important to set some exit price level in case some events cause the price to move in the unlikely direction. Having safety measures in place helps limit potential losses while letting the gains grow.
Thank you.
Paul Rejczak
Stock Trading Strategist
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