Briefly: In our opinion, no speculative positions are justified.
Our intraday outlook remains neutral, and our short-term outlook is neutral:
Intraday outlook (next 24 hours): neutral
Short-term outlook (next 1-2 weeks): neutral
Medium-term outlook (next 1-3 months): neutral
Long-term outlook (next year): bullish
The main U.S. stock market indexes lost between 0.6% and 1.4% on Wednesday, as investors reacted to FOMC Rate Decision release, among others. The S&P 500 index got closer to the level of 2,000, retracing most of its recent gains. The nearest important level of support is at 1,990-2,000, marked by previous local lows. On the other hand, resistance level remains at 2,050-2,065. For now, the broad stock market trades within its medium-term consolidation, as we can see on the daily chart:
Expectations before the opening of today’s trading session are positive, with index futures currently up 0.2-0.4%. The European stock market indexes have been mixed so far. Investors will now wait for some economic data announcements: Initial Claims at 8:30 a.m., Pending Home Sales at 10:00 a.m. The S&P 500 futures contract (CFD) is in a relatively narrow intraday consolidation, following yesterday’s sell-off. The nearest important resistance level is at 2,000, and support level is at 1,985-1,990, marked by local low:
The technology Nasdaq 100 futures contract (CFD) is in a similar intraday consolidation, as it fluctuates above the level of 4,100. The nearest important level of resistance is at around 4,130-4,150, among others, as the 15-minute chart shows:
Concluding, the broad stock market extended its sell-off yesterday, retracing most of January’s rebound. It continues to look like a volatile medium-term consolidation following last year’s October-November rally. We still 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.