No Clear Short-Term Direction As Investors Take Some Profits

Briefly: In our opinion, no speculative positions are justified.

Our intraday outlook is now 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 0.2-0.4% on Wednesday, following quite volatile trading session, as investors reacted to FOMC Rate Decision release. Our yesterday’s neutral intraday outlook has proved accurate. However, the S&P 500 index extended its short-term uptrend slightly, as it got closer to the level of 2,000. The nearest important resistance level is at around 2,000-2,020, marked by September 19th all-time high of 2,019.26, among others. On the other hand, the level of support remains at 1,870-1,880, marked by previous resistance level. There have been no confirmed negative signals so far, however, we can see some short-term overbought conditions which may lead to a downward correction:

Expectations before the opening of today’s trading session are negative, with index futures currently down 0.3-0.5%. The main European stock market indexes have lost 0.8-1.6% so far. Investors will now wait for some economic data announcements: Initial Claims, GDP – Advance number at 8:30 a.m. The S&P 500 futures contract (CFD) is in a short-term consolidation, as it fluctuates along the level of 1,970. The level of resistance is at around 1,980-1,985, and the nearest support level is at 1,960, as we can see on the 15-minute chart:

The technology Nasdaq 100 futures contract (CFD) retraced some of its recent move up, as it bounced off the resistance level at 4,100. The nearest important level of support is at around 4,050, as the 15-minute chart shows:

Concluding, the broad stock market extended its short-term consolidation, following the FOMC Decision announcement. There have been no confirmed negative signals so far. However, we can see some short-term overbought conditions which may lead to a downward correction. We prefer to be out of the market, avoiding low risk/reward ratio trades. We will let you know when we think it is safe to get back in the market