Briefly: In our opinion, no speculative positions are justified.

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

Intraday (next 24 hours) outlook: neutral
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 were mixed between 0.0% and +0.7% on Tuesday, extending their short-term consolidation, as investors continued to hesitate following oil prices crash, quarterly corporate earnings releases. The S&P 500 index trades above the level of 2,000, which is positive. The nearest important level of support is at 1,990-2,000, marked by recent local lows. On the other hand, resistance level is at 2,030-2,050, among others. There is no clear short-term direction, as we can see on the daily chart:

Expectations before the opening of today’s trading session are virtually flat. The European stock market indexes have been mixed between -0.4% and +0.6% so far. Investors will now wait for some economic data announcements: Housing Starts, Building Permits at 8:30 a.m. The S&P 500 futures contract (CFD) extends its short-term consolidation, as it trades along the level of 2,020. The nearest important support level remains at around 2,000:

The technology Nasdaq 100 futures contract (CFD) is in a similar consolidation, as it trades above the level of 4,150. The nearest important resistance level is at 4,190-4,200, marked by some previous local extremes, as the 15-minute chart shows:

Concluding, the broad stock market extended its short-term consolidation on Tuesday, as it remained above the level of 2,000. There is still no clear short-term direction. For now, it looks like a volatile medium-term consolidation following last year’s October-November rally. 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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