Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
The S&P 500 remained within a tight trading range on Tuesday – will it continue the uptrend?
The S&P 500 index lost 0.46% yesterday as it retraced more of its Friday’s 1.9% rally. On Thursday the index fell to local low of 4,048.28 and on Friday it traded as high as 4,147. Last week on Monday the S&P 500 was the highest since February 2.
Stocks will likely open 0.7% higher this morning after the Consumer Price Index release. It was at +4.9% vs. the expected +5.0% y/y. So the index may get back to its Friday’s closing price. Last week the S&P 500 bounced from the important 4,200 resistance level again as we can see on the daily chart:
Futures Contract Gets Back Above 4,150
Let’s take a look at the hourly chart of the S&P 500 futures contract. It is back above the 4,150 level this morning. The nearest important resistance level is at around 4,160-4,200, and the support level remains at 4,120, among others.
Conclusion
The S&P 500 index will likely open 0.7% higher on lower-than-expected Consumer Price Index release. The market may extend its Friday’s rally following Monday’s-Tuesday’s correction. It still looks like a consolidation after March-April advances.
Here’s the breakdown:
- The S&P 500 will likely retrace its Monday’s-Tuesday’s correction.
- The market extends a few-week-long consolidation.
- In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
