• 274 days Could Crypto Overtake Traditional Investment?
  • 279 days Americans Still Quitting Jobs At Record Pace
  • 281 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 284 days Is The Dollar Too Strong?
  • 284 days Big Tech Disappoints Investors on Earnings Calls
  • 285 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 287 days China Is Quietly Trying To Distance Itself From Russia
  • 287 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 291 days Crypto Investors Won Big In 2021
  • 291 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 292 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 294 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 295 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 298 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 299 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 299 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 301 days Are NFTs About To Take Over Gaming?
  • 302 days Europe’s Economy Is On The Brink As Putin’s War Escalates
  • 305 days What’s Causing Inflation In The United States?
  • 306 days Intel Joins Russian Exodus as Chip Shortage Digs In
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…

Contact Author

  1. Home
  2. Markets
  3. Other

Stock Trading Alert: Short-Term Uncertainty As Investors Await Economic Data Releases

Stock Trading Alert originally published on August 4, 2016, 6:38 AM:


 

Briefly: In our opinion, speculative short positions are favored (with stop-loss at 2,210, and profit target at 2,050, S&P 500 index).

Our intraday outlook is bearish, and our short-term outlook is bearish. Our medium-term outlook is now neutral, following S&P 500 index breakout above last year's all-time high:

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): neutral

The main U.S. stock market indexes gained 0.2-0.3% on Wednesday, retracing some of their recent move down, as investors reacted to economic data, quarterly earnings releases. The S&P 500 index continues to trade within a short-term consolidation following last month's rally. The nearest important level of support is at around 2,150, marked by Tuesday's daily low. The next important support level is at 2,130-2,135, marked by previous level of resistance. On the other hand, resistance level is at 2,170-2,175, marked by Monday's all-time high of 2,178.29. The next potential resistance level is at 2,200. For now, it looks like a relatively flat correction within medium-term uptrend. Will the market continue higher? Or is this some kind of a topping pattern before downward reversal?

S&P500 Futures Daily Chart
Larger Image

Expectations before the opening of today's trading session are virtually flat. The European stock market indexes have been mixed so far. The S&P 500 futures contract trades within an intraday consolidation following yesterday's rebound. The nearest important level of resistance is at around 2,160, marked by short-term local high. On the other hand, support level remains at 2,140-2,150, as we can see on the 15-minute chart:

S&P500 Futures 15-Minute Chart
Larger Image

The technology Nasdaq 100 futures contract follows a similar path, as it currently trades along the level of 4,720. The nearest important support level is at around 4,700. On the other hand, resistance level is at 4,730, and the next resistance level is at 4,750-4,760, marked by local highs, as the 15-minute chart shows:

NASDAQ100 Futures 15-Minute Chart
Larger Image

Concluding, the broad stock market continues to fluctuate following last month's rally. The S&P 500 index remains close to its new record high of 2,178.29. We still can see technical overbought conditions accompanied by bearish technical divergences. Therefore, we continue to maintain our speculative short position (opened on July 18th at 2,162, S&P 500 index). Stop-loss level is at 2,210 and potential profit target is at 2,050 (S&P 500 index). You can trade S&P 500 index using futures contracts (S&P 500 futures contract - SP, E-mini S&P 500 futures contract - ES) or an ETF like the SPDR S&P 500 ETF - SPY. 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.

 

Back to homepage

Leave a comment

Leave a comment