Our intraday outlook is bearish, and our short-term outlook is bearish. Our mediumterm outlook remains neutral, following S&P 500 index breakout above last year's alltime high:
Intraday outlook (next 24 hours): bearish
Short-term outlook (next 1-2 weeks): bearish
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): neutral
The main U.S. stock market indexes gained between 0.4% and 0.6% on Friday, extending their short-term uptrend, as investors' sentiment remained bullish following recent economic data releases, among others. The S&P 500 index has reached new all-time high at the level of 2,463.54. The broad stock market gauge has broken above its previous July 19 record high above 2,450 mark. The Dow Jones Industrial Average was relatively weaker than the broad stock market on Friday, as it gained just 0.4%. However, it reached new record high at the level of 21,681.53. The technology Nasdaq Composite was relatively stronger again, as it gained 0.6%. It gets closer to June 6 all-time high of 6,341.7. The nearest important support level of the S&P 500 index is now at around 2,450-2,455, marked by June 19 local high. The next level of support is at 2,430-2,435, marked by last Wednesday's daily gap up of 2,429.30-2,435.75. The support level also remains at 2,400-2,410, marked by the May 25 daily gap up of 2,405.58-2,408.01, among others. On the other hand, potential level of resistance is at 2,465, marked by new alltime high. The next resistance level is at 2,500 mark. There have been no confirmed negative signals so far. However, we can see overbought conditions and negative technical divergences. The S&P 500 index broke above its over month-long consolidation, as we can see on the daily chart:
At New Record High
Expectations before the opening of today's trading session are positive, with index futures currently between +0.1% and +0.2% vs. their Friday's closing prices. The European stock market indexes have been mixed so far. Investors will now wait for the Empire Manufacturing number release at 8:30 a.m. The market expects that it was at 13.0 in July. Investors will also wait for quarterly corporate earnings releases. The S&P 500 futures contract trades within an intraday consolidation, following Friday's rally. The market trades close to its new record high slightly above the level fo 2,460. The nearest important level of resistance is at around 2,455-2,460, marked by record high. On the other hand, support level is at 2,440-2,450, and the next support level is at 2,420- 2,430, marked by recent consolidation. Will the market extend its uptrend? Or is this some topping pattern before downward reversal?
Techs Lead Rally
The technology Nasdaq 100 futures follows a similar path, as it trades within an intraday consolidation. It fluctuates after last week's rally. The Nasdaq has retraced almost all of its June decline. It currently trades closer to record high, and less than 1% below 5,900 mark. The nearest important level of resistance is at around 5,870-5,900, marked by alltime high. On the other hand, support level is at 5,800-5,820, and the next level of support is at 5,780, marked by some recent fluctuations, as the 15-minute chart shows:
Concluding, the S&P 500 index broke above its month-long trading range on Friday, as investors' sentiment improved. Will uptrend accelerate towards 2,500 mark? Or is this some topping pattern before downward reversal? There have been no confirmed negative signals so far. However, we still can see negative technical divergences, along with medium-term overbought conditions.
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All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' employees and 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, Przemyslaw Radomski, CFA 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. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA 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. Przemyslaw Radomski, CFA, 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.