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).
Stocks extended their short-term downtrend on Friday – is this still just a correction?
The S&P 500 index lost 0.11% on Friday as it continued to trade within a short-term uptrend. The market reached new local low of 4,443.98, but it retraced some of the intraday decline. On Friday it was 163.09 points or 3.54% below its July 27 medium-term high of 4,607.07.
There is still a lot of uncertainty concerning monetary policy, some technology/AI stocks’ valuation concerns, but investors’ sentiment remains bullish.
Stocks are expected to open 0.1% lower today. The market may see more short-term uncertainty following the recent declines. The S&P 500 remains below the 4,500 level as we can see on the daily chart:
Futures Contract Fluctuates Below 4,500
Let’s take a look at the hourly chart of the S&P 500 futures contract. This morning it’s trading below the 4,480 level. The nearest important support level is at 4,450 and the resistance level is at 4.500, among others.
Conclusion
The S&P 500 index will likely extend its consolidation below the 4,500 level this morning. It still looks like a correction within an uptrend. However, the market may see some more uncertainty.
Here’s the breakdown:
- The S&P 500 extended its downtrend on Friday, but it remained relatively close to the 4,500 level.
- In my opinion, the short-term outlook is still 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
