Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): long positions with entry at 4,340 price level, with 4,020 as a stop-loss and 4,640 as an initial price target.
Stocks prices are going down very fast on Russia-Ukraine war news. Will they finally reach a local bottom of the panic sell-off?
The S&P 500 index lost 1.84% on Wednesday, Feb. 23, and this morning it is expected to open 2.3% lower. So the market will likely break below the late January lows and below the 4,200 level. We may see more volatility, however it looks like a short-term bottom.
The nearest important resistance level is now at 4,300, marked by the recent local lows. On the other hand, the support level is at 4,000-4,100, among others. The S&P 500 index is about to extend the downtrend, as we can see on the daily chart (chart by courtesy of http://stockcharts.com):
Futures Contract Trades Along the 4,120 Level
Let’s take a look at the hourly chart of the S&P 500 futures contract. It sold off overnight, as it broke below the 4,200 level. The market trades along our Tuesday’s long position stop-loss level.
Due to an extraordinary volatility we decided to lower the stop-loss to the 4,020 level. There’s a potential support level of 4,050, marked by the local lows from May of 2021. (We will move the stop-loss level only one time). We are expecting an upward correction from the current levels (chart by courtesy of http://tradingview.com):
Conclusion
The S&P 500 index is likely to open much lower following an overnight global stock markets’ sell-off on Ukraine news. We may see a short-term bottom, however the volatility will remain much elevated.
Here’s the breakdown:
- The S&P 500 index will open below the late January local low, as it will accelerate the downtrend on Ukraine news.
- We are moving our Tuesday’s long position’s stop-loss level to 4,020 (one time only).
- We are expecting an upward correction from the current levels.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): long positions with entry at 4,340 price level, with 4,020 as a stop-loss and 4,640 as an initial price target.
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
