Stock Trading Alert: No Clear Short-Term Direction - Is The Worst Over?
Stock Trading Alert originally published on August 31, 2015, 6:53 AM:
Briefly: In our opinion, no speculative positions are justified
Our intraday outlook is neutral, and our short-term outlook is neutral:
Intraday outlook (next 24 hours): neutral
Short-term outlook (next 1-2 weeks): neutral
Medium-term outlook (next 1-3 months): bearish
Long-term outlook (next year): bullish
The U.S. stock market indexes were virtually flat on Friday, following their recent rebound, as investors took short-term profits off the table. Our Friday's neutral intraday outlook has proved accurate. The S&P 500 index remains below the level of 2,000. The nearest important level of resistance is at around 1,980-2,000. On the other hand, support level is at 1,940-1,960, marked by recent local highs. There have been no confirmed positive signals so far. For now, it looks like a short-term upward correction following recent sell-off:
Expectations before the opening of today's trading session are negative, with index futures currently down 0.6-0.7%. The European stock market indexes have lost 0.4-0.6% so far. Investors will now wait for the Chicago PMI number release at 9:45 a.m. The S&P 500 futures contract (CFD) trades within an intraday consolidation. The nearest important level of resistance is at around 1,980-1,990, marked by Friday's local highs. On the other hand, support level is at 1,950,1960, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) continues to trade along the level of 4,300. The nearest important level of resistance is at 4,330, and support level is at 4,270-4,280, as we can see on the 15-minute chart:
Concluding, the broad stock market is in a consolidation following recent volatile trading. For now, it looks like a correction within a short-term downtrend. Our late April's short position's (2,098.27, S&P 500 index) profit target has been reached at the level of 1,980. Overall, we gained almost 120 index points on that pre-planned trade. We prefer to be out of the market at this moment, avoiding low risk/reward ratio trades. We will let you know when we think it is safe to get back in the market.