Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
S&P 500 fell from new medium-term high – is the uptrend over?
The broad stock market index lost 0.64% on Thursday after reaching new medium-term high of 4,607.07. The market went the highest since late March of 2022 but a news release from the Bank of Japan has pushed stock prices lower. The S&P 500 retraced most of its recent advances as it broke below 4,550.
There is still a lot of uncertainty concerning monetary policy, some technology/AI stocks’ valuation concerns, but the investors’ sentiment remains bullish. The market is waiting for more quarterly corporate earnings releases.
Stocks are expected to open 0.6% higher, so the S&P 500 index will likely retrace some of its yesterday’s intraday decline. The market remains above a two-month-long upward trend line as we can see on the daily chart:
Futures Contract Is Closer to 4,600 Again
Let’s take a look at the hourly chart of the S&P 500 futures contract. Yesterday it rallied to around 4,635 but then it quickly retreated below the 4,600 level. The support level is at 4,550 and the resistance level remains at around 4,600-4,610.
Conclusion
Stocks will likely retrace some of their yesterday’s declines today. The broad stock market may go sideways following yesterday’s reversal. It still looks like a consolidation and a relatively flat correction within an uptrend.
Here’s the breakdown:
- The S&P 500 may extend its consolidation despite yesterday’s downward reversal.
- Investors will wait for more quarterly earnings releases next week.
- In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; S&P 500 futures contract): In my opinion, the short-term outlook is bullish and long positions are still justified from the risk/reward point of view (since Feb. 27).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
