The main U.S. stock market indexes lost between 1.0% and 1.9% on Thursday, as investors reacted to some better-than-expected economic data announcements, fearing that the Fed may start tapering its asset purchasing program. However, the blue-chips DJIA index managed to reach yet another new intraday all-time high at 15,797.68. The S&P 500 index lost 1.3%, breaching the support of around 1,750. The next important support is at 1,733.45-1,735.74, marked by the October 18 daily gap up. Breakout below the recent consolidation is a negative signal, as we can see on the daily chart:

Expectations before the opening of today’s session are slightly positive, with index futures currently gaining 0.1-0.4%. The European stock market indexes have lost 0.4-0.7% so far. Investors will now wait for some key economic data announcements: Nonfarm Payrolls and Unemployment Rate at 8:30 a.m., Michigan Sentiment at 9:55 a.m., and JOLTS – Job Opening at 10:00 a.m. The S&P 500 futures contract (CFD) broke below the support of 1,750. The price bounced off the area of 1,740-1,745, however, it only looks like an upward correction within a short-term downtrend. The next important support is at around 1,735, marked by the late October lows, as the 15-minute chart shows:

Our intraday outlook remains bearish, and our short-term outlook is bearish:

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

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Thank you,
Paul Rejczak