Stock Trading Alert originally published on November 13, 2014, 6:02 AM:
Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,085 and profit target at 1,950, S&P 500 index).
Our intraday outlook is bearish, and our short-term outlook is bearish:
Intraday (next 24 hours) outlook: bearish
Short-term (next 1-2 weeks) outlook: bearish
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The U.S. stock market indexes were virtually flat on Wednesday, as investors continued to hesitate following recent move up. The S&P 500 index remains close to Thursday's all-time high of 2,041.28. The nearest important resistance level is at around 2,040-2,050. On the other hand, the level of support is at 2,020-2,025, marked by previous local extremes. There have been no confirmed negative signals so far, however, we can see short-term overbought conditions:
Expectations before the opening of today's trading session are positive, with index futures currently up 0.3%. The main European stock market indexes have gained 0.4-0.9% so far. Investors will now wait for some economic data announcements: Initial Claims at 8:30 a.m., JOLTS - Job Openings at 10:00 a.m. The S&P 500 futures contract (CFD) is in an intraday uptrend, as it trades close to new all-time high. The resistance level is at around 2,050, and the nearest important level of support is at around 2,035-2,040, marked by previous local extremes, as we can see on the 15-minute chart:
The technology Nasdaq 100 futures contract (CFD) is relatively stronger, as it trades above the level of 4,200. The nearest important support level is at around 4,180, marked by previous level of resistance. There have been no confirmed negative signals so far, as the 15-minute chart shows:
Concluding, the broad stock market remains close to all-time highs, as it extends recent fluctuations. We expect a downward correction or an uptrend reversal. Therefore, we continue to maintain our speculative short position. Stop-loss is at 2,085 and potential profit target is at 1,950 (S&P 500 index). It is always important to set some exit price level in case some events cause the price to move in the unlikely direction. Having safety measures in place helps limit potential losses while letting the gains grow.