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Paul Rejczak

Paul Rejczak

Writer, Sunshine Profits

Stock market strategist, who has been known for quality of his technical and fundamental analysis since the late nineties. He is interested in forecasting market…

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Stock Trading Alert: Closer To All-Time High - Make Or Break Moment

Stock Trading Alert originally published on May 22, 2014, 7:12 AM:


 

Briefly: In our opinion speculative long positions are still favored (with stop-loss at 1,850, S&P 500 index).

Our intraday outlook is still bullish, and our short-term outlook remains neutral:

Intraday (next 24 hours) outlook: bullish
Short-term (next 1-2 weeks) outlook: neutral
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish

The main U.S. stock market indexes gained 0.8-1.0% yesterday, breaking above their recent consolidation, as investors' sentiment improved following FOMC Minutes release, among others. The S&P 500 index remains slightly below its May 13 all-time high of 1,902.17. The resistance is at 1,880-1,900. On the other hand, the support level is at 1,860-1,865, and the next support is at 1,850. There have been no confirmed negative signals so far, however, there has been no clear breakout above medium-term consolidation neither:

S&P500 Daily Chart
Larger Image

Expectations before the opening of today's session are virtually flat, with index futures currently up 0.1%. The European stock market indexes have been mixed between -0.2% and +0.2% so far. Investors will now wait for some economic data announcements: Initial Claims at 8:30 a.m., Existing Home Sales, Leading Indicators at 10:00 a.m. The S&P 500 futures contract (CFD) trades slightly below last week's highs, following yesterday's move up. The resistance is at around 1,895-1,900, and the nearest important support level is at 1,880-1,885, marked by previous resistance, as we can see on the 15-minute chart:

S&P500 15-Minute Chart
Larger Image

The technology Nasdaq 100 futures contract (CFD) continues its short-term uptrend, as it is above the resistance of 3,600-3,620. The nearest resistance is at 3,650-3,670, marked by some early April local highs. On the other hand, the nearest important support is at 3,600, marked by previous resistance, as the 15-minute chart shows:

NASDAQ 100 Futures Chart
Larger Image

Concluding, the broad stock market confirms our speculative long position (which is already profitable), as it approaches last week's all-time high. Will it break above the resistance? It is hard to say. However, we are quite comfortable with our long position here, with stop-loss at 1,850 (S&P 500 index).

Thank you.

 

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