Stock Trading Alert: Closer To All-Time High – Make Or Break Moment

May 22, 2014

Briefly: In our opinion speculative long positions are still favored (with stop-loss at 1,850, S&P 500 index).

Our intraday outlook is still bullish, and our short-term outlook remains neutral:

Intraday (next 24 hours) outlook: bullish
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 0.8-1.0% yesterday, breaking above their recent consolidation, as investors’ sentiment improved following FOMC Minutes release, among others. The S&P 500 index remains slightly below its May 13 all-time high of 1,902.17. The resistance is at 1,880-1,900. On the other hand, the support level is at 1,860-1,865, and the next support is at 1,850. There have been no confirmed negative signals so far, however, there has been no clear breakout above medium-term consolidation neither:

Expectations before the opening of today’s session are virtually flat, with index futures currently up 0.1%. The European stock market indexes have been mixed between -0.2% and +0.2% so far. Investors will now wait for some economic data announcements: Initial Claims at 8:30 a.m., Existing Home Sales, Leading Indicators at 10:00 a.m. The S&P 500 futures contract (CFD) trades slightly below last week’s highs, following yesterday’s move up. The resistance is at around 1,895-1,900, and the nearest important support level is at 1,880-1,885, marked by previous resistance, as we can see on the 15-minute chart:

The technology Nasdaq 100 futures contract (CFD) continues its short-term uptrend, as it is above the resistance of 3,600-3,620. The nearest resistance is at 3,650-3,670, marked by some early April local highs. On the other hand, the nearest important support is at 3,600, marked by previous resistance, as the 15-minute chart shows:

Concluding, the broad stock market confirms our speculative long position (which is already profitable),  as it approaches last week’s all-time high. Will it break above the resistance? It is hard to say. However, we are quite comfortable with our long position here, with stop-loss at 1,850 (S&P 500 index).

Thank you.

Paul Rejczak
Stock Trading Strategist

Stock Trading Alerts

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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.

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