• 1 day Silver Stocks Have Been Decimated In The Coronavirus Sell-Off
  • 2 days How Blockchain Tech Could Make Mergers And Acquisitions More Efficient
  • 2 days America’s Shortage Of This Metal Keeps Trump Up At Night
  • 3 days Bidet Bonanza: Defying The Toilet Paper Shortage
  • 3 days U.S. Auto Sales Fall By 75%
  • 4 days Violating Quarantine? Big Brother Is Watching
  • 4 days Does Gold Still Have Some Room To Run?
  • 4 days Major Acquisition Gives The World’s First Green Ride-Share Another Edge
  • 5 days U.S. Pushes For Digital Currency For Immediate Stimulus
  • 5 days The Impossible Challenges Created By Growing Population
  • 5 days Gold Skyrockets After Fed Pledges "Unlimited" Cash To Boost Economy
  • 6 days World’s Richest Lose $1 Trillion In Stock Market Rout
  • 6 days Gas Stations Shut Down In Venezuela As Coronavirus Crisis Intensifies
  • 6 days The Best And Worse Case Scenario For The U.S. Stock Market
  • 7 days 3 Industries Soaring During The Coronavirus Crisis
  • 7 days The Key To Commercial Hydrogen
  • 8 days Gold Still Beating Much Of The Market Despite Sell-Off
  • 8 days Gold Miners Struggle With COVID-19 Fallout
  • 9 days The Dollar Reigns Supreme In Times Of Crisis
  • 9 days The Most Exciting Green Startups To Watch In 2020
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

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: Stocks Extend Their Short-Term Gains, But Will They Continue Higher?

Stock Trading Alert originally published on September 29,  2016, 6:51 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 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 U.S. stock market indexes gained between 0.2% and 0.6% on Wednesday, extending their short-term uptrend, as investors reacted to economic data releases, among others. The S&P 500 index continues to trade along its July - August consolidation. The nearest important level of resistance is at around 2,160, marked by Monday's daily gap down of 2,158.54-2,163.97. The next important level of resistance is at around 2,170, marked by previous daily gap down, among others. On the other hand, support level is at around 2,120-2,140, marked by local lows. The market trades within a downward correction following recent rally. Will it continue its uptrend? Or is this some topping pattern before downward reversal?

S&P500 Daily Chart
Larger Image

Expectations before the opening of today's trading session are virtually flat. The European stock market indexes have gained 0.7-0.9% so far. Investors will now wait for some economic data announcements: GDP - Third Estimate number, Initial Claims at 8:30 a.m., Pending Home Sales at 10:00 a.m. The S&P 500 futures contract trades within an intraday downtrend, following yesterday's advance. The nearest important level of resistance is at around 2,170. On the other hand, support level remains at 2,130-2,150, marked by recent consolidation, as we can see on the 15-minute chart:

S&P500 15-Minute Chart
Larger Image

The technology Nasdaq 100 futures contract remains relatively stronger than the broad stock market, as it is close to its last week's new all-time high. However, it currently trades within an intraday downtrend. The nearest important support level is at around 4,850, marked by previous resistance level. The nearest important resistance level is at 4,880-4,900, among others, as the 15-minute chart shows:

NASDAQ100 15-Minute Chart
Larger Image

Concluding, the broad stock market slightly extended its short-term uptrend yesterday. Is this a new medium-term uptrend or just upward correction? We still 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