Sentiment Improves As Investors Hope For More Uptrend
Briefly: In our opinion, no speculative positions are justified.
Our intraday outlook remains neutral, and our short-term outlook is neutral:
Intraday (next 24 hours) outlook: neutral
Short-term (next 1-2 weeks) outlook: neutral
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The main U.S. stock market indexes gained 0.2-0.6% on Friday, extending their recent move up, as investors’ sentiment improved ahead of quarterly earnings releases, among others. Our Friday’s neutral intraday outlook has proved accurate(link). The S&P 500 index extended its short-term consolidation, as it remained above month-long upward trend line. The resistance is at around 1,980-1,985, marked by July 3 all-time high of 1,985.59. The next resistance is at the psychological level of 2,000. On the other hand, the level of support remains at around 1,950-1,690, marked by recent local lows. For now, it looks like a flat correction within long-term uptrend, as we can see on the daily chart:
Expectations before the opening of today’s session are positive, with index futures currently up between 0.3% and 0.4%. The European stock market indexes have gained 0.5-0.8% so far. Investors will now wait for some quarterly earnings releases. The S&P 500 futures contract (CFD) is in an intraday uptrend, following last week’s downward correction. The nearest important resistance is at around 1,975, marked by recent highs, and the support level remains at 1,950-1,960, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) is relatively stronger, as it trades close to long-term high. The resistance level is at around 3,915-3,920, and the level of support is at 3,890-3,900, among others:
Concluding, the broad stock market extends its consolidation, as the S&P 500 index trades slightly below its early July all-time high. We remain neutral, as there may be some more volatility following medium-term uptrend. We think that it is better to stay out of the market at this moment, just to avoid low risk/reward ratio trades. Earnings season can be a time of increased volatility as investors react to news from the companies. So, it may be better to cut back on your trading or even move to the sidelines completely, especially following recent run-up. We’ll let you know when we think it is safe to get back in the market.
Stock Trading Strategist
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All essays, research and information found above represent analyses and opinions of Paul Rejczak and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Paul Rejczak and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Rejczak is not a Registered Securities Advisor. By reading Paul Rejczak’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Paul Rejczak, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Paul Rejczak is a stock market strategist, who has been known for quality of his technical and fundamental analysis since the late nineties. He is interested in forecasting market behavior based on both traditional and innovative methods of technical analysis. Paul has made his name by developing mechanical trading systems. Paul is the author of Sunshine Profits’ premium service for stock traders: Stock Trading Alerts.