Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,140 and profit target at 1,990, S&P 500 index)
Our intraday outlook is bearish, and our short-term outlook is bearish:
Intraday outlook (next 24 hours): bearish
Short-term outlook (next 1-2 weeks): bearish
Medium-term outlook (next 1-3 months): bearish
Long-term outlook (next year): bullish
The U.S. stock market indexes were virtually flat on Thursday, as investors took some short-term profits off the table. The S&P 500 index remains below resistance level of 2,100. The next important resistance level is at around 2,130, marked by May all-time high. On the other hand, support level is at 2,020-2,050. For now, it looks like a consolidation following October rally:
Expectations before the opening of today's trading session are positive, with index futures currently up 0.2-0.3%. The main European stock market indexes have been mixed so far. The S&P 500 futures contract (CFD) trades within an intraday consolidation, as it extends its Thursday's fluctuations. The nearest important level of resistance is at around 2,090. On the other hand, support level is at 2,075, marked by local lows, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) extends its short-term consolidation along the level of 4,650. The nearest important level of resistance is at 4,670-4,680, and support level is at 4,650, as we can see on the 15-minute chart:
Concluding, the broad stock market remained within a short-term consolidation on Thursday, as investors took some profits off the table. Despite recent rally, there have been no confirmed positive signals so far. Therefore, we continue to maintain our speculative short position (2,088.35, S&P 500 index). Stop-loss is at 2,140 and potential profit target is at 1,990 (S&P 500 index). You can trade S&P 500 index using futures contracts (S&P 500 futures contract - SP, E-mini S&P 500 futures contract - ES) or an ETF like the SPDR S&P 500 ETF - SPY. It is always important to set some exit price level in case some events cause the price to move in the unlikely direction. Having safety measures in place helps limit potential losses while letting the gains grow.
Thank you.
Paul Rejczak
Stock Trading Strategist
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