Stock Trading Alert originally published on January 12, 2015, 7:06 AM:
Briefly: In our opinion, no speculative positions are justified.
Our intraday outlook remains neutral, and our short-term outlook is neutral:
Intraday (next 24 hours) outlook: neutral
Short-term (next 1-2 weeks) outlook: neutral
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The U.S. stock market indexes lost between 0.6% and 1.0% on Friday, retracing some of their recent move up, as investors reacted to economic data announcements, among others. The S&P 500 index remains within three-month long consolidation. The nearest important level of resistance is at around 2,060-2,065, marked by last week's local high. On the other hand, support level remains at around 2,030, marked by previous level of resistance. For now, it looks like an upward correction following late December - early January decline. There is no clear short-term direction, as we can see on the daily chart:
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 0.2-0.6% so far. The S&P 500 futures contract (CFD) is in an intraday consolidation, following Friday's move down. The nearest important resistance level is at 2,040-2,050, and support level remains at 2,030, marked by recent local lows, as the 15-minute chart shows:
The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it trades along the level of 4,200. For now, it looks like a flat correction within a short-term uptrend. The nearest important resistance level is at around 4,240-4,250, marked by local highs:
Concluding, the broad stock market gave up some of its earlier gains on Friday, as investors reacted to economic data releases, among others. For now, it looks like a volatile medium-term consolidation following last year's October-November rally. We prefer to be out of the market, avoiding low risk/reward ratio trades. We will let you know when we think it is safe to get back in the market.
Thank you.
