The major U.S. stock market indexes lost between 0.1% and 0.6% yesterday, as investors continued to take profits following recent move up. The S&P 500 index dropped below the level of 1,800, leaving its week-long consolidation. The nearest important support remains at around 1,770-1,775, marked by the late October, early November consolidation, followed by the recent local low. However, the index bounced off 1,785-1,790 area, as investors bought yesterday’s dip. On the other hand, the resistance is at the psychological 1,800, as we can see on the daily chart:

Expectations before the opening of today’s session are slightly positive, with index futures currently up 0.1-0.2%. The European stock market indexes have been mixed so far. Investors will now wait for some economic data announcements: ADP Employment Change report at 8:15 a.m., Trade Balance at 8:30 a.m., ISM Services index and New Home Sales at 10:00 a.m. Finally, the Fed will release its Beige Book, which is a monthly report on the U.S. economy, at 2:00 p.m. The S&P 500 futures contract (CFD) trades below the level of 1,800, however slightly bouncing off the area of 1,785-1,790. The next support is at around 1,775-1,780, and the resistance remains at 1,800, as the 15-minute chart shows:

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

Intraday (next 24 hours) outlook: bearish
Short-term (next 1-2 weeks) outlook: bearish
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish

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Thank you,
Paul Rejczak