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Before the Bell: Futures Expectations Down -- Is the Plunge Over Yet?

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The market remains in a short-term downtrend, however, it may consolidate for some time following last week's sharp sell-off.

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Briefly: In my firm's opinion, short positions are still favored (stop-loss at 1,850, short-term profit target at around 1,800, S&P 500 Index (INDEXSP:.INX)), and they have been already profitable.
 
The main US stock market indices lost between 0.9% and 1.2% on April 11, extending their recent move down, as investors continued to sell stocks, worried by the geopolitical risk of Russia-Ukraine conflict and other risks. The S&P 500 Index is in a short-term downtrend, below its March consolidation. The resistance remains at 1,840-1,850, marked by previous support. On the other hand, a potential level of support is at around 1,800-1,810. The next support is at 1,775, marked by some of the previous local lows, as we can see on the daily chart:
 

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Expectations before the opening of today's session are negative, with index futures currently down 0.2-0.3%. The European stock market indices have lost 0.6-0.7% so far. Investors will now wait for some economic data announcements: Retail Sales number at 8:30 a.m. and Business Inventories at 10:00 a.m.

The S&P 500 futures contract (CFD) remains in a short-term downtrend, extending last week's move down. There have been no confirmed downtrend reversal signals so far. However, the market is close to the psychological support of 1,800. The resistance is at around 1,825-1,830, marked by Friday's local highs, as the 15-minute chart shows:
 

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The technology Nasdaq-100 (INDEXNASDAQ:NDX) futures contract (CFD) has extended its short -term downtrend, breaking below the psychological level of 3,500. The resistance is at around 3,480-3,500. On the other hand, a potential support is at around 3,400-3,420, marked by the early February local lows. There have been no confirmed positive signals so far:
 

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Our intraday outlook is now neutral as the market may consolidate after selling off recently, and our short-term outlook remains bearish, following breakdown below March-April consolidation:
 
Intraday (next 24 hours) outlook: neutral
Short-term (next 1-2 weeks) outlook: bearish
Medium-term (next 1-3 months) outlook: neutral
Long-term outlook (next year): bullish

Concluding, the market remains in a short-term downtrend, however, it may consolidate for some time following last week's sharp sell-off.

For the full version of this essay and more, visit Sunshine Profits' website.

Paul Rejczak is a stock market strategist who has been known for the quality of his technical and fundamental analysis since the late 1990s. 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. He is the author of Sunshine Profits' premium service for stock traders: Stock Trading Alerts.
No positions in stocks mentioned.
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