Briefly: In our opinion, no speculative positions are justified.
Our intraday outlook remains neutral, and our short-term outlook is neutral, following last Tuesday’s intraday reversal:
Intraday
(next 24 hours) outlook: neutral
Short-term (next 1-2 weeks) outlook: neutral
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The U.S. stock market indexes were mixed between -0.2% and +0.1% on Monday, as investors continued to hesitate following recent consolidation. Our yesterday’s neutral intraday outlook has proved to be accurate. The S&P 500 index continues to fluctuate slightly below its June 24 all-time high of 1,968.17. For now, it looks like a flat correction within an uptrend. The nearest important level of resistance is at 1,960-1,970, and the support level is at 1,940-1,950. The index remains above month-long upward trend line, which is positive:
Expectations before the opening of today’s session are positive, with index futures currently up 0.2-0.3%. The main European stock market indexes have gained 0.3-0.6% so far. Investors will now wait for some economic data announcements: Construction Spending, ISM Index at 10:00 a.m. The S&P 500 futures contract (CFD) trades close to its long-term high, just below the level of resistance at 1,960. On the other hand, the support level is at 1,945-1,950, among others, as we can see on the 15-minute chart:
The technology Nasdaq 100 futures contract (CFD) is relatively stronger, as it extends its long-term uptrend, reaching new highs this morning. The nearest important level of support is at around 3,825-3,830, marked by recent local extremes, as the 15-minute chart shows:
Concluding, the broad stock market is in a short-term consolidation, as the S&P 500 index trades slightly below its record high. Will uptrend continue? The beginning of a new quarter favors the bullish case here, however, there is some short-term overbought which may lead to a correction. We think that it is better to stay out of the market at this moment.
Thank you.
Paul Rejczak
Stock Trading Strategist
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