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Stock Trading Alert: Uncertainty Following Yesterday's Move Up - New Uptrend Or Just A Quick Bounce?

By: Paul Rejczak | Thursday, April 10, 2014

Stock Trading Alert originally published on Apr 10, 2014, 6:57 AM:


 

Briefly: In our opinion no speculative positions are justified.

Our intraday outlook remains neutral, as the market may retrace some of yesterday's move up, extending its month-long fluctuations, 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 gained between 1.1% and 1.8% on Wednesday, retracing some of their recent move down, as investors reacted to the FOMC Minutes release, hoping for prolonged easy monetary policy. The S&P 500 index trades higher within its March-April consolidation, after bouncing off the support at around 1,840-1,850. The bounce was not that much of a surprise, as we have stated in our yesterday's forecast: "(...) a downtrend reversal cannot be ruled out - the market is at the support of 1,840-1,850, marked by March consolidation, among others". The resistance remains at 1,880-1,900. There is no clear short-term trend, as we can see on the daily chart:

S&P500 Daily Chart
Larger Image

Expectations before the opening of today's session are negative, with index futures currently down 0.2-0.3%. The European stock market indexes have been mixed so far. Investors will now wait for the Initial Claims data announcement at 8:30 a.m. The S&P 500 futures contract (CFD) has bounced off the support at 1,830-1,840. There is some intraday resistance at around 1,865. For now, it only looks like a correction within downtrend. The resistance remains at 1,875-1,890, as the 15-minute chart shows:

S&P500 15-Minute Chart
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The technology Nasdaq 100 futures contract (CFD) has followed a similar path, bouncing off the support at 3,480-3,500. The nearest important resistance is at the psychological 3,600. The market remains in a month-long downtrend, as it keeps establishing lower lows and lower highs:

NASDAQ 100 Futures Chart
Larger Image

Concluding, yesterday's move up looks corrective and there have been no confirmed signals of a new short-term uptrend so far.

Thank you.

 

Author: Paul Rejczak

Paul Rejczak
Stock Trading Strategist
Stock Trading Alerts
SunshineProfits.com

Paul Rejczak

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.

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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