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 before session’s open).
Stocks retreated a bit yesterday – is the uptrend over? Or is it just a correction?
The S&P 500 index lost 0.58% on Tuesday after reaching new medium-term high of 4,133.13. The market reversed its intraday uptrend and it got back to the 4,100 level. The index was the highest since February 16 yesterday. Recently the S&P 500 was advancing from the March 13 local low of 3,909.16.
Stocks will likely open 0.2% lower this morning. So the market may see more short-term uncertainty following the rally. The S&P 500 is within its early February topping pattern, and below the important resistance level of 4,200 as we can see on the daily chart:
Futures Contract Trades Below Friday’s High
Let’s take a look at the hourly chart of the S&P 500 futures contract. This morning it’s trading along the 4,120 level. The market is now below the last week’s Friday’s local high. The resistance level is at 4,150-4,170 and the support level is at 4,100-4,120, among others.
Conclusion
The S&P 500 index reached new medium-term high yesterday, but it retraced the intraday advance and closed at the 4,100 mark. For now, it looks like a correction within an uptrend.
Here’s the breakdown:
- Stocks will fluctuate following their recent rally; for now it looks like a correction.
- The S&P 500 was the highest since mid-February yesterday.
- 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 before session’s open).
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
