The U.S. stock market indexes gained between 0.3% and 0.6% yesterday, extending their short-term fluctuations. For now, it only looks like a flat correction of the recent move up, however, some deeper retracement cannot be excluded here, as the market sentiment seems to be overly bullish. The S&P 500 index continues to fluctuate after breaking above the upper limit of its potential May-October rising wedge pattern. The resistance remains at 1,759.33, marked by Tuesday’s all-time high. The nearest support is at 1,733.45-1,735.74, marked by last Friday’s daily gap up, and the next support is at 1,729.86, marked by the September 19 high, as we can see on the daily chart:

Expectations before the opening of today’s session are quite positive, as investors react to some better-than-expected tech industry earnings (Microsoft, Amazon). The main European stock market indexes have been mixed so far. Investors will now wait for the economic data announcements: Durable orders number at 8:30 a.m., Michigan Sentiment indicator at 9:55 a.m., and Wholesale Inventories change at 10:00 a.m. The S&P 500 futures contract (CFD) extends its short-term consolidation, just below the resistance at around 1,750-1,755, marked by the long-term highs. The support is at 1,735, marked by the recent fluctuations. The market trades near its short-term upward trend line, as the 15-minute chart shows:

Our intraday outlook is now bearish, and our short-term outlook remains neutral, as there may be some further uncertainty following recent rally:

Intraday outlook: bearish
Short-term outlook: neutral
Medium-term outlook: neutral
Long-term outlook: bullish

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Thank you,
Paul Rejczak