Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): No positions are currently justified from the risk/reward point of view.
The S&P 500 index remained close to its recent low yesterday following Wednesday’s sharp downward reversal. Will it break lower?
The broad stock market index lost 0.58% on Thursday, as it closed almost exactly at the 3,900 level. On Wednesday it retraced its recent advance from the new medium-term low of 3,858.87. On Thursday a week ago it was 959.8 points or 19.9% below the Jan. 4 record high of 4,818.62. Then the market rallied to the Tuesday’s local high of around 4,091. This morning it is expected to open 0.9% higher, so we will see an upward correction.
Futures Contract
Let’s take a look at the hourly chart of the S&P 500 futures contract. On Wednesday it broke below the support level of around 3,980-4,000 before bouncing from the support level of 3,850, and today it is trading well above the 3,900 level.
In our opinion, no positions are currently justified from the risk/reward point of view. (chart by courtesy of http://tradingview.com):
Conclusion
The S&P 500 index is expected to open 0.9% higher this morning on global stock markets’ bounce. The market will likely retrace some of its Wednesday’s sell-off. For now, it looks like an upward correction.
Here’s the breakdown:
- The S&P 500 index fluctuated following its Wednesday’s sell-off yesterday. We will likely see an upward correction this morning.
- In our opinion, no positions are currently justified from the risk/reward point of view.
As always, we’ll keep you, our subscribers, well-informed.
Trading position (short-term, our opinion; levels for S&P 500 continuous futures contract): No positions are currently justified from the risk/reward point of view.
Thank you.
Paul Rejczak,
Stock Trading Strategist
Sunshine Profits: Effective Investments through Diligence and Care
