Briefly: In our opinion speculative long positions are still favored (with stop-loss at 1,850, S&P 500 index).
Our intraday outlook is bullish, and our short-term outlook remains neutral:
Intraday
(next 24 hours) outlook: bullish
Short-term (next 1-2 weeks) outlook: neutral
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The main U.S. stock market indexes lost 0.1-0.3% on Friday, retracing some of their recent move up, as investors neglected better-than-expected monthly employment report release. The S&P 500 index got closer to its early April all-time high of 1,897.28, before moving slightly lower. The resistance remains at around 1,880-1,900, and the nearest important level of support is at 1,850, marked by recent local low, among others. For now, it looks like some sort of a flat correction within an uptrend, however, the market remains close to its important resistance levels, as we can see on the daily chart:
Expectations before the opening of today’s session are negative, with index futures currently down 0.4-0.5%. The European stock market indexes have lost between 1.1% and 1.4% so far, following some worse-than-expected economic data releases, Russia-Ukraine conflict. Investors will now wait for the ISM Services number release at 10:00 a.m. The S&P 500 futures contract (CFD) is in an intraday downtrend, as it bounced off the resistance at 1,880-1,885. The nearest important support level is at around 1,845-1,855, marked by the recent local lows, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) is in a similar intraday downtrend, as it bounced off the psychological resistance at 3,600. For now, it looks like a correction within a short-term uptrend, as there have been no confirmed reversal signals so far:
Concluding, the broad stock market is expected to retrace some more of its last-week’s gains, as investors react to economic data announcements, negative geopolitical news. However, there have been no confirmed uptrend reversal signals so far and it seems that our profitable long positions will remain such in the coming days.
Thank you.
Paul Rejczak
Stock Trading Strategist
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