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.
The S&P 500 extended its advance yesterday and this morning it will open even higher following earnings releases. But the short-term top may be in sight.
The broad stock market index gained 1.21% on Thursday after gaining 2.6% on Wednesday, as it accelerated its uptrend following breaking above the 4,000 level. It extended an over month-long uptrend from the medium-term low of 3,636.87 (June 17), despite the ongoing worries about inflation, tightening Fed’s monetary policy, and Russia-Ukraine conflict. This morning the S&P 500 is expected to open 0.5% higher and we will likely see an intraday consolidation today.
Futures Contract Got Close to 4,100 Level
Let’s take a look at the hourly chart of the S&P 500 futures contract. It got close to the 4,100 level following yesterday’s earnings releases from AAPL and AMZN. We can see some short-term overbought conditions, however, there have been no confirmed negative signals so far.
In our opinion, no positions are currently justified from the risk/reward point of view. (chart by courtesy of http://tradingview.com):
Conclusion
The S&P 500 index is expected to open 0.5% higher. The market will slightly extend its short-term uptrend, but a local high may be in sight, as investors will likely take some short-term profits off the table following recent stock prices rallies.
Here’s the breakdown:
- The S&P 500 will likely open slightly higher this morning; we may see an intraday consolidation.
- In our opinion, no positions are currently justified from the risk/reward point of view.
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
