Briefly: In our opinion, no speculative positions are justified
Our intraday outlook is neutral, and our short-term outlook is neutral:
Intraday outlook (next 24 hours): neutral
Short-term outlook (next 1-2 weeks): neutral
Medium-term outlook (next 1-3 months): bearish
Long-term outlook (next year): bullish
The U.S. stock market indexes lost 0.3-0.5% on Thursday, extending their recent move down, as investors reacted to economic data announcements. The S&P 500 index got closer to the level of 1,900, before bouncing off support level. The nearest important level of resistance is at around 1,950. On the other hand, level of support remains at 1,900-1,920. There have been no confirmed positive signals so far. The market continues to fluctuate following late August sell-off:
Expectations before the opening of today's trading session are positive, with index futures currently up 1.2-1.5%. The main European stock market indexes have gained 2.4-3.3% so far. Investors will now wait for some economic data announcements: GDP - Third estimate at 8:30 a.m., Michigan Sentiment number at 10:00 a.m. The S&P 500 futures contract (CFD) trades within an intraday uptrend, as it retraces its recent move down. The nearest important level of resistance is at around 1,950. On the other hand, support level is at 1,920-1,930, marked by local highs, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it currently trades along the level of 4,300. The nearest important level of support is at 4,250, and resistance level is at 4,330-4,350, marked by local highs, as we can see on the 15-minute chart:
Concluding, the broad stock market extended its short-term downtrend on Thursday, before bouncing off support level of 1,900 (S&P 500 index). There have been no confirmed positive signals so far. It looks like an upward correction within a medium-term downtrend. We prefer to be out of the market, avoiding low risk/reward ratio trades. We will let you know when we think it is safe to get back in the market.
Thank you.
Paul Rejczak
Stock Trading Strategist
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