Stock Trading Alert originally sent to subscribers on December 15, 2014, 7:03 AM.
Briefly: In our opinion, speculative short
positions are favored (with stop-loss at 2,085 and profit target at 1,950,
S&P 500 index).
Our
intraday outlook is bearish, and our short-term outlook is bearish:
Intraday
(next 24 hours) outlook: bearish
Short-term (next 1-2 weeks) outlook: bearish
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The U.S.
stock market indexes lost between 1.1% and 1.8% on Friday, extending their
short-term downtrend, as investors reacted to worsening global economic outlook
following oil prices sell-off, among others. The S&P 500 index is the lowest
since late October, as it trades close to the level of 2,000. The nearest
important support level is at around 2,000, marked by the October 31st
daily gap up of 1,999.4-2,001.2, among others. On the other hand, level of
resistance remains at around 2,020-2,025, marked by recent local lows, as we
can see on the daily chart:
Expectations
before the opening of today’s trading session are positive, with index futures
currently up 0.7-0.8%. The main European stock market indexes have gained 0.3-0.5%
so far. Investors will now wait for some economic data announcements: Empire
Manufacturing number at 8:30 a.m., Industrial Production, Capacity Utilization
at 9:15 a.m., NAHB Housing Market Index at 10:00 a.m. The S&P 500 futures
contract (CFD) is in an intraday uptrend, as it retraces some of its recent
decline. The nearest important level of support is at around 1,990-2,000, and
resistance level is at 2,020-2,030, among others, as the 15-minute chart shows:
The technology
Nasdaq 100 futures contract (CFD) follows a similar path as it trades above the
level of 4,200. The nearest important level of support remains at 4,180-4,200,
and resistance level is at 4,250, among others:
Concluding,
the broad stock market extended its short-term downtrend, as the S&P 500
index got closer to the level of 2,000. We continue to maintain our already
profitable short position with entry point at 2,038 (November 12th
opening price of the S&P 500 index). Stop-loss is at 2,085 and potential
profit target is at 1,950 (S&P 500 index). 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.
Paul Rejczak
Stock Trading Strategist
Stock Trading Alerts
