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).
Stock prices bounced on Friday – which direction is next?
The S&P 500 index gained 0.99% on Friday, as it retraced its Thursday’s decline of 0.6%. The market extended a consolidation along the 4,550-4,600 level. On Thursday Bank of Japan’s news has pushed stock prices lower, but on Friday the market came back higher.
There is still a lot of uncertainty concerning monetary policy, some technology/AI stocks’ valuation concerns, but the investors’ sentiment remains bullish. The market is waiting for more quarterly corporate earnings releases.
Stocks will likely open 0.2% higher this morning. So the S&P 500 will continue to fluctuate within a consolidation. The market remains above a two-month-long upward trend line as we can see on the daily chart:
Futures Contract Is Above 4,600 Again
Let’s take a look at the hourly chart of the S&P 500 futures contract. Today it’s trading above the 4,600 level. The nearest important resistance level is at around 4,635, marked by last week’s local high. On the other hand the support level is at 4,580-4,600.
Conclusion
The S&P 500 index will likely open higher this morning. The broad stock market may extend its sideways trading action following the Thursday’s retreat. It still looks like a consolidation and a relatively flat correction within an uptrend. The market will be waiting for more quarterly earnings releases, including Thursday’s reports from AMZN and AAPL.
Here’s the breakdown:
- The S&P 500 remains close to its recent local high and the 4,600 level.
- Investors will wait for more quarterly earnings releases.
- 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
