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Paul Rejczak

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Stock Trading Alert: More Short-Term Uncertainty As Investors Await Quarterly Earnings Releases

Stock Trading Alert originally published on April 2, 2015, 6:39 AM:


 

Briefly: In our opinion, no speculative positions are justified.

Our intraday outlook is now 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): neutral
Long-term outlook (next year): bullish

The U.S. stock market indexes lost 0.4-0.5% on Wednesday, retracing their Monday's move up, as investors reacted to worse-than-expected economic data announcements. The S&P 500 index remains close to support level of 2,040-2,050, marked by previous local lows. On the other hand, level of resistance is at around 2,080-2,090. For now, it looks like some further fluctuations within a medium-term consolidation following October-November rally:

S&P500 Daily Chart
Larger Image

Expectations before the opening of today's trading session are slightly negative, with index futures currently down 0.3-0.4%. The European stock market indexes have been virtually flat so far. Investors will now wait for some economic data announcements: Challenger Job Cuts report at 7:30 a.m., Initial Claims, Trade Balance at 8:30 a.m., Factory Orders at 10:00 a.m. The S&P 500 futures contract (CFD) trades within an intraday downtrend, as it extends its short-term consolidation along the level of 2,050. The nearest important level of support remains at around 2,030-2,040, as the 15-minute chart shows:

S&P500 15-Minute Chart
Larger Image

The technology Nasdaq 100 futures contract (CFD) continues to trade along the level of 4,300. The nearest important level of resistance is at 4,320-4,330, marked by some recent local highs. On the other hand, support level is at 4,260,4,280, marked by local lows, as we can see on the 15-minute chart:

NASDAQ 100 Futures 15-Minute Chart
Larger Image

Concluding, the broad stock market continues to trade within a short-term consolidation, as investors remain uncertain ahead of Friday's monthly jobs report announcement, quarterly corporate earnings releases. For now, it looks like further 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.

 

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