Stock Market Negative Expectations Once Again - Will It Break Down?

By: Paul_Rejczak

Briefly: In our opinion, no speculative positions are justified

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

The U.S. stock market indexes were mixed between -0.9% and +0.7% on Friday, as investors reacted to economic data releases. The S&P 500 index extends its short-term consolidation following late August sell-off. The nearest important level of support is at around 1,900-1,920, marked by local lows. On the other hand, resistance level is at 1,950, and the next important level of resistance is at 2,000. There have been no confirmed positive signals so far. It looks like a correction within a medium-term downtrend:

Expectations before the opening of today's trading session are negative, with index futures currently down 0.6%. The European stock market indexes have lost 1.4-2.1% so far. Investors will now wait for some economic data announcements: Personal Income, Personal Spending, PCE - Prices Core number at 8:30 a.m., Pending Home Sales at 10:00 a.m. The S&P 500 futures contract (CFD) trades within an intraday downtrend, as it gets closer to a potential support level of 1,900. The nearest important level of resistance remains at around 1,930-1,950, as the 15-minute chart shows:

The technology Nasdaq 100 futures contract (CFD) follows a similar path, as it trades below the level of 4,200. The nearest important level of support is at 4,100-4,150, marked by previous local lows. On the other hand, resistance level is at around 4,240-4,250, as we can see on the 15-minute chart:

Concluding, the broad stock market continues to fluctuate following its late August sell-off. There have been no confirmed positive signals so far. It looks like an upward correction within a medium-term downtrend. 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.

Paul Rejczak
Stock Trading Strategist
Stock Trading Alerts
SunshineProfits.com

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 behavior based on both traditional and innovative methods of technical analysis. Paul has made his name by developing mechanical trading systems. Paul is the author of Sunshine Profits’ premium service for stock traders: Stock Trading Alerts.

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Disclaimer

All essays, research and information found above represent analyses and opinions of Paul Rejczak and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Paul Rejczak and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Rejczak is not a Registered Securities Advisor. By reading Paul Rejczak’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Paul Rejczak, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

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