Stock Market: The clarity of the bull market picture is diminishing.
On Friday, the S&P 500 index fell from Thursday’s high of 4,793.30 but rebounded from the daily low of around 4,752 to close just 0.28% lower. The broad stock market gauge remained close to its all-time high of 4,818.62 on January 4, 2022. Investor sentiment remains bullish. However, according to last Wednesday’s AAII Investor Sentiment […]
On Friday, the S&P 500 index fell from Thursday’s high of 4,793.30 but rebounded from the daily low of around 4,752 to close just 0.28% lower. The broad stock market gauge remained close to its all-time high of 4,818.62 on January 4, 2022. Investor sentiment remains bullish. However, according to last Wednesday’s AAII Investor Sentiment Survey, only 46.3% of individual investors remain bullish, which is lower than the previous reading of 52.9%.
Since the release of the FOMC Statement on December 13, the market has been continuing its uptrend. In early December, the S&P 500 broke above the late July local high of around 4,607, resuming a rally from the local low of 4,103.78 on October 27.
Currently, the S&P 500 futures contract is indicating a 0.6% lower opening of the trading session compared to Friday’s close. The market is expected to extend its short-term correction from Friday. As mentioned last Thursday, it is likely that there will be consolidation between 4,700-4,800. This prediction is proving to be accurate. To capitalize on this trading action, it is better to shorten the timeframe of trades and look for buying opportunities at support levels and selling at resistance levels.
On Friday, it became obvious that the 4,800 level will be a strong resistance, as shown on the daily chart.
This morning, stocks are expected to continue their downward correction from Friday, with the S&P 500 futures contract trading 0.6% lower. In my previous Thursday’s analysis, I noted that the market may experience more uncertainty and volatility in the short term. This has proven to be the case, following an early-December rally and the S&P 500’s breakout above the 4,700 level. While there is still a chance of extending the uptrend, no confirmed medium-term negative signals have emerged. However, the short-term market outlook is currently unclear, and indexes may be starting to correct downwards.
Since the release of the FOMC Statement on December 13, the market has been continuing its uptrend. In early December, the S&P 500 surpassed the late July local high of approximately 4,607, continuing a rally from the local low of 4,103.78 on October 27.
This morning, stocks are expected to continue their downward correction from Friday, with the S&P 500 futures contract trading 0.6% lower. In my previous Thursday’s analysis, I noted that the market may experience more uncertainty and volatility in the short term. This has proven to be the case, following an early-December rally and the S&P 500’s breakout above the 4,700 level. While there is still a chance of extending the uptrend, no confirmed medium-term negative signals have emerged. However, the short-term market outlook is currently unclear, and indexes may be starting to correct downwards.
