Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): long positions with entry at 4,340 price level, with 4,440 as the stop-loss (take profit) and 4,740 as the price target.

Stocks are expected to open much higher following potential Ukraine conflict ceasefire news. Will this mark a short-term high?

The S&P 500 index gained 0.71% on Monday after its Friday’s advance of 0.5%. The broad stock market’s gauge extended the short-term uptrend and it neared 4,600 mark. This morning it will likely break slightly above that level following positive geopolitical news. However, we may see some profit-taking action later in the day.

Futures Contract Broke Above the 4,600 Level

Let’s take a look at the hourly chart of the S&P 500 futures contract. It’s trading above the short-term upward trend line and above the 4,600 level. The market broke above its previous local highs. We can see some technical overbought conditions, however, there have been no confirmed negative signals so far.

We are maintaining our profitable long position from the 4,340 level. However, to protect our gain, yesterday we decided to move the stop-loss (take profit) level to 4,440, just below the recent local low. We also moved the price target to 4,740. (chart by courtesy of http://tradingview.com):

Conclusion

The S&P 500 index will likely open 0.8% higher this morning following the Ukraine conflict news. However, we may see some intraday volatility and profit-taking action later in the day. The market will be waiting for today’s JOLTS Job Openings and CB Consumer Confidence releases at 10:00 a.m. and Friday’s monthly jobs data release.

Here’s the breakdown:

• The S&P 500 index further extended its uptrend yesterday and this morning it will likely cross the 4,600 level.
• We are maintaining our profitable long position (opened on Feb. 22 at 4,340), but yesterday we moved stop-loss (take profit) and price target levels higher.
• We are still expecting some upside from the current levels; however, it is time to get more cautious as there may be a downward correction at some point.

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 4,440 as the stop-loss (take profit) and 4,740 as the price target.

Thank you.

Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care