Briefly: In our opinion, no speculative positions are justified.

Our intraday outlook is neutral, and our short-term outlook is neutral. Our medium-term outlook remains neutral, following S&P 500 index breakout above last year's all-time high:

Intraday outlook (next 24 hours): neutral
Short-term outlook (next 1-2 weeks): neutral
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): neutral

The U.S. stock market indexes were mixed between -0.4% and +0.2% on Monday, as investors hesitated following last week's broad stock market's rally. The S&P 500 index reached new all-time high at the level of 2,264.03, before closing lower by 0.1%. The nearest important resistance level is at around 2,260-2,265. On the other hand, support level is at 2,240-2,250, marked by previous level of resistance. The next important support level remains at 2,200-2,220. The market broke above its medium-term upward trend line recently, as we can see on the daily chart:

Expectations before the opening of today's trading session are positive, with index futures currently up 0.3-0.4%. The main European stock market indexes have gained 0.5-0.8% so far. Investors will wait for tomorrow's FOMC Rate Decision announcement, among others. The S&P 500 futures contract trades within an intraday uptrend, as it retraces its yesterday's move down off new record high. The nearest important level of resistance is at 2,270, marked by an all-time high. On the other hand, support level remains at 2,250, marked by previous resistance level. There have been no confirmed negative signals so far. However, we can see technical overbought conditions:

The technology Nasdaq 100 futures contract follows a similar path, as it trades within an intraday uptrend. The nearest important level of resistance is at 4,900-4,920. On the other hand, support level is at 4,850-4,860, marked by short-term local lows, as the 15-minute chart shows:

Concluding, the broad stock market reached yet another new record high on Monday, as investors' sentiment remained very bullish ahead of Wednesday's FOMC Rate Decision release. We still can see technical overbought conditions. However, there have been no confirmed negative signals so far. Our speculative short position has been closed on Wednesday at the stop-loss level of 2,240 (S&P 500 index). We lost 63 index points on that trade, betting against short-term uptrend off early November local low. 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. Currently, we prefer to be out of the market, avoiding low risk/reward ratio trades. We will let you know when we think it is safe to get back in the market.

Thank you.

Paul Rejczak
Stock Trading Strategist
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