Stock Trading Alert originally sent to subscribers on October 16, 2014, 6:03 AM.
Briefly: In our opinion, no speculative
positions are justified at this moment.
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 lost between 0.6% and 1.1% on Wednesday, extending their
recent move down, as investors kept selling stocks ahead of quarterly corporate
earnings releases, economic data announcements. The S&P 500 index bounced
off sharply following a quick sell-off to new medium-term low at 1,820.66,
which is almost 200 points below the September 19th all-time high of
2,019.26. The nearest important resistance level is at around 1,870-1,875,
marked by previous support level. On the other hand, potential level of support
is at 1,800-1,820. There have been no confirmed positive signals so far,
however, we can see some oversold conditions:
Expectations
before the opening of today’s trading session are negative, with index futures
currently down 0.9-1.1%. The main European stock market indexes have lost
1.8-2.8% so far. Investors will now wait for some economic data announcements: Initial
Claims at 8:30 a.m., Industrial Production at 9:15 a.m., Philadelphia Fed, NAHB
Housing Market Index at 10:00 a.m. The S&P 500 futures contract (CFD) is in an intraday
downtrend, as it trades closer to yesterday’s low. The nearest important level
of support is at around 1,810-1,820, as we can see on the 15-minute chart:
The
technology Nasdaq 100 futures contract (CFD) follows a similar path, as it is
close to yesterday’s low. Support level remains at around 3,690-3,700. On the
other hand, the level of resistance is at 3,750-3,760, among others:
Concluding,
the broad stock market extended its recent sell-off, as the S&P 500 index
fell almost 10% below its September all-time high above the level of 2,000. There
are some short-term oversold conditions which may lead to an upward correction
or downtrend reversal at some point. Therefore, we prefer to be out of the
market at this moment. 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
