S&P 500 Up 6% Since Year End, Stocks Continue Higher Despite Warning Signs

IMG Auteur
Published : January 23rd, 2018
691 words - Reading time : 1 - 2 minutes
( 0 vote, 0/5 )
Print article
  Article Comments Comment this article Rating All Articles  
0
Send
0
comment
Our Newsletter...
Category : Opinions and Analysis

The U.S. stock market indexes gained 0.6-1.0% on Monday, extending their uptrend, as investors' sentiment remained very bullish. The S&P 500 index has reached new record high at the level of 2,833.03. It broke above its last week's short-term consolidation along the level of 2,800. The Dow Jones Industrial Average has also reached new record high at the level of 26,215.23. However, the blue-chip index was relatively weaker than the broad stock market. The technology Nasdaq Composite was relatively strong, as it gained 1.0% and reached new all-time high at 7,408.03. The nearest important level of support of the S&P 500 index is at 2,800-2,810, marked by previous resistance level. The next support level is at around 2,780, marked by recent local lows. The support level is also at 2,765-2,770, marked by the January 11 daily gap up of 2,767.56-2,769.64. We still can see medium-term technical overbought conditions along with negative technical divergences. However, the market continues to extend its nine-year-long bull market:

24hGold - SP 500 Up 6 Since Ye...

Mixed Expectations

Expectations before the opening of today's trading session are virtually flat, with index futures currently between -0.1% and +0.1% vs. their yesterday's closing prices. The European stock market indexes have been mixed so far. There will be no new important economic data announcements today. The S&P 500 futures contract trades within an intraday downtrend following yesterday's rally. It retraces some of its overnight move up. The nearest important level of resistance is at around 2,840, marked by new record high. On the other hand, support level is at 2,825-2,830, marked by yesterday's intraday consolidation. The next level of support is at 2,800-2,810, marked by previous resistance level. The futures contract remains relatively close to its new record high, as the 15-minute chart shows:

24hGold - SP 500 Up 6 Since Ye...

Nasdaq Relatively Stronger

The technology Nasdaq 100 futures contract follows a similar path, as it retraces some of its overnight advance. It remains close to new all-time high following breakout above 6,900 mark. The nearest important level of resistance is at around 6,950-6,960. On the other hand, support level is at 6,880-6,900. The next level of support remains at 6,800-6,830, marked by some recent fluctuations. The Nasdaq 100 futures contract remains above its short-term upward trend line, as we can see on the 15-minute chart:

24hGold - SP 500 Up 6 Since Ye...

Let's take a look at Apple, Inc. stock (AAPL) daily chart (chart courtesy of http://stockcharts.com). The stock reached new record high on Thursday last week, following short-term consolidation along the support level of $175. The market got closer to $180 mark, but it failed to continue its short-term uptrend. We still can see some negative technical divergences. The most common divergences are between asset’s price and some indicator based on it (for instance the index and RSI based on the index). In this case, the divergence occurs when price forms a higher high and the indicator forms a lower high. It shows us that even though price reaches new highs, the fuel for the uptrend starts running low.

24hGold - SP 500 Up 6 Since Ye...

Netflix, Inc. stock (NFLX) was relatively stronger than the broad stock market yesterday. It accelerated its medium-term uptrend ahead of quarterly earnings announcement. The stock is expected to continue its bull run today, following better-than-expected earnings release. However, we can see some short-term overbought conditions. Potential resistance level is at around $250:

24hGold - SP 500 Up 6 Since Ye...

The Dow Jones Industrial Average daily chart shows that blue-chip index reached new record high yesterday, as it broke above its Thursday's high and continued breakout above 26,000 mark. We still can see some medium-term negative technical divergences. The index trades above its two-month-long rising wedge pattern (failed uptrend reversal pattern):

24hGold - SP 500 Up 6 Since Ye...

Concluding, the S&P 500 index gained 0.8% on Monday, as it accelerated its uptrend following breakout above last week's consolidation along the level of 2,800. The broad stock market continues its almost month-long bullish euphoria run. The index is currently trading 6% above its December 29 yearly closing price. Is this some medium-term topping pattern before uptrend reversal? There have been no confirmed negative signals so far. However, we still can see medium-term overbought conditions along with negative technical divergences.

Thank you.

Paul Rejczak
Stock Trading Strategist
Stock Trading Alerts
Sunshine Profits - Free Stock Market Analysis

Data and Statistics for these countries : Georgia | All
Gold and Silver Prices for these countries : Georgia | All
<< Previous article
Rate : Average note :0 (0 vote)
>> Next article
Przemyslaw Radomski is the founder, owner and the main editor of www.SunshineProfits.com. Being passionately curious about the market’s behavior he uses his statistical and financial background to question the common views and profit on the misconceptions. “Don’t fight the emotionality on the market – take advantage of it!” is one of his favorite mottos. His time is divided mainly to analyzing various markets with emphasis on the precious metals, managing his own portfolio, writing commentaries, essays and developing financial software. Most of the time he’s got left is spent on reading everything he can about the markets, psychology, philosophy and statistics. Mr. Radomski has started investigating the markets for his private use well before starting his professional career. He used to work as an informatics consultant, but this time-consuming profession left him little time for his true passion – the interdisciplinary market analysis. Establishing www.SunshineProfits.com gave him the opportunity to put his thoughts, ideas, and experience into form available to other investors.
WebsiteSubscribe to his services
Comments closed
Latest comment posted for this article
Be the first to comment
Add your comment
Top articles
World PM Newsflow
ALL
GOLD
SILVER
PGM & DIAMONDS
OIL & GAS
OTHER METALS
Take advantage of rising gold stocks
  • Subscribe to our weekly mining market briefing.
  • Receive our research reports on junior mining companies
    with the strongest potential
  • Free service, your email is safe
  • Limited offer, register now !
Go to website.