Stock Trading Alert originally sent to subscribers on August 25, 2014, 7:10 AM.
Briefly: In our opinion, no speculative positions
are justified.
Our
intraday outlook is neutral, and our short-term outlook is neutral:
Intraday
(next 24 hours) outlook: neutral
Short-term (next 1-2 weeks) outlook: neutral
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish
The U.S.
stock market indexes were mixed between -0.2% and +0.1% on Friday, as investors
hesitated following Janet Yellen’s speech at Fed’s Jackson Hole Conference. Our
Friday’s neutral intraday outlook has proved accurate. The S&P 500
index remains close to its Thursday’s all-time of 1,994.76, slightly below the
level of 2,000. The nearest important resistance level is at 1,990-2,000, and
the level of support is at 1,970, among others. There have been no confirmed
negative signals so far, however, we can see some overbought conditions which
may lead to a downward correction:
Expectations
before the opening of today’s session are slightly positive, with index futures
currently up 0.2-0.3%. The main European stock market indexes have gained
0.9-1.0% so far. Investors will now wait for the New Home Sales data release at
10:00 a.m. This report indicates the level of new privately owned one-family
houses sold and for sale. However, it is considered to be a lagging indicator
of demand in the market. The S&P 500 futures contract (CFD) trades close to
its new intraday all-time high, just below the level of 2,000. On the other
hand, the level of support is at around 1,980-1,985, marked by recent local
lows, as we can see on the 15-minute chart:
The
technology Nasdaq 100 futures contract (CFD) follows a similar path, as it
trades just below its long-term high. The nearest important resistance level is
at around 4,080-4,100, and the support level is at 4,050-4,060, among others,
as the 15-minute chart shows:
Concluding,
the broad stock market extends its uptrend, as the S&P 500 index trades
close to the level of 2,000. There have been no confirmed negative signals so
far. However, there are some negative technical divergences, accompanied by
short-term overbought conditions. In our opinion, no speculative positions are
justified. We still prefer to be out of the market , just to avoid 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
