Slightly Negative Expectations Following Last Week's Rally
Briefly: In our opinion, no speculative positions are justified.
Our intraday outlook is now neutral, and our short-term outlook is neutral:
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): bullish
The U.S. stock market indexes gained between 0.7% and 0.9% on Friday, extending their short-term uptrend, as investors hoped for more gains following a positive reaction to last week's Fed Rate Decision announcement. The S&P 500 index is relatively close to its February 25 all-time high of 2,119.59. The nearest important level of resistance is at around 2,100-2,120. On the other hand, support level is at 2,080-2,090, marked by previous local extremes. For now, it looks like some further medium-term consolidation following October-November rally:
Expectations before the opening of today's trading session are slightly negative, with index futures currently down 0.1-0.3%. The main European stock market indexes have lost 0.4-1.3% so far. Investors will now wait for the Existing Home Sales number release at 10:00 a.m. The S&P 500 futures contract (CFD) trades within an intraday downtrend, as it retraces some of Friday's move up. The nearest important level of resistance is at around 2,100-2,105, marked by some local highs. On the other hand, support level is at 2,075-2,080, among others, as we can see on the 15-minute chart:
The technology Nasdaq 100 futures contract (CFD) follows a similar path as it retraces some of its Friday's advance. The nearest important level of resistance is at around 4,460-4,470, and support level remains at around 4,410, marked by Thursday's local lows, as the 15-minute chart shows:
Concluding, the broad stock market extended its short-term uptrend on Friday. However, we can see some profit taking following recent move up. There have been no confirmed negative signals so far. For now, it looks like some further medium-term consolidation, following last year's October-November rally. 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.
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.