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Stock Trading Alert: New Record High - Will Uptrend Extend Even Further?

Stock Trading Alert originally published on February 23, 2015, 6:10 AM:


 

Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,150 and profit target at 1,980, S&P 500 index)

Our intraday outlook is bearish, and our short-term outlook is bearish:

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

The U.S. stock market indexes gained between 0.6% and 0.9% on Friday, extending their short-term uptrend, as investors remained bullish following economic news releases. The S&P 500 index has reached yet another new all-time high at the level of 2,110.61. The nearest important level of support is at around 2,100, marked by previous resistance level. There have been no confirmed negative signals so far. However, we can see overbought conditions accompanied by negative divergences:

S&P500 Daily Chart
Larger Image

Expectations before the opening of today's trading session are slightly negative, with index futures currently down 0.1-0.2%. The main European stock market indexes have been mixed so far. Investors will now wait for the Existing Home Sales number announcement at 10:00 a.m. The S&P 500 futures contract (CFD) is in an intraday downtrend, as it retraces some of its Friday's move up. The nearest important resistance level is at around 2,110, marked by Friday's local high. On the other hand, support level is at 2,100, among others, as we can see on the 15-minute chart:

S&P500 15-Minute Chart
Larger Image

The technology Nasdaq 100 futures contract (CFD) remains relatively stronger than the broad stock market, as it trades close to long-term high. The nearest important level of resistance is at 4,440-4,450, and support level is at 4,420-4,430, among others, as the 15-minute chart shows:

NASDAQ 100 Futures 15-Minute Chart
Larger Image

Concluding, the broad stock market extended its short-term uptrend on Friday. There have been no confirmed negative signals. However, we continue to maintain our speculative short position (S&P 500 index), as we expect a downward correction or an uptrend reversal. Stop-loss is at 2,150, and potential profit target is at 1,980. 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.

Thank you.

 

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