Indexes Made New Highs – Will Uptrend Extend Even Further?

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 gained between 0.2% and 0.5% on Friday, extending their recent uptrend, as investors reacted to some better-than expected economic data announcements. The S&P 500 index has managed to reach yet another new all-time high at the level of 2,071.46. Potential resistance level is at around 2,080-2,100. On the other hand, the nearest important level of support is at 2,050-2,055, marked by previous resistance level, and the next support level is at around 2,040. There have been no confirmed negative signals so far, however, we can see overbought conditions accompanied by negative divergences:

Expectations before the opening of today’s trading session are slightly positive, with index futures currently up 0.2%. The main European stock market indexes have been mixed so far. The S&P 500 futures contract (CFD) trades close to Friday’s all-time high, as it fluctuates along the level of 2,065. The nearest important resistance level is at around 2,070-2,075, and support level is at 2,050-2,055, among others, as the 15-minute chart shows:

The technology Nasdaq 100 futures contract (CFD) continues to fluctuate following recent move up. The nearest important level of resistance is at around 4,280-4,300, and support level remains at 4,235-4,245, marked by previous resistance level, as we can see on the 15-minute chart:

Concluding, the broad stock market continues its long-term uptrend. There have been no confirmed negative signals so far. However, we expect a downward correction or an uptrend reversal. Therefore, we continue to maintain our speculative short position. 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.