Breaking News
0

More Uncertainty as Stocks Got Closer to January Record High

By Paul RejczakStock MarketsAug 09, 2018 12:09PM ET
www.investing.com/analysis/more-uncertainty-as-stocks-got-closer-to-january-record-high-200337688
More Uncertainty as Stocks Got Closer to January Record High
By Paul Rejczak   |  Aug 09, 2018 12:09PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

The U.S. stock market indexes were mixed between -0.2% and +0.1% on Wednesday, as investors hesitated following the recent advance. The S&P 500 index remains above the level of 2,850 and it currently trades just 0.5% below the January's 26 record high of 2,872.87. The Dow Jones Industrial Average lost 0.2% and the technology NASDAQ Composite gained 0.1% yesterday.

The nearest important level of support of the S&P 500 index remains at around 2,850, marked by the recent level of resistance. The next level of support is at 2,825-2,835, marked by the recent local lows. The support level is also at around 2,800. On the other hand, the nearest important level of resistance is at 2,870-2,875, marked by the mentioned January's all-time high. Potential level of resistance is also at 2,900.

The broad stock market got even closer to its January's record high, as investors' sentiment improved following quarterly corporate earnings, economic data releases. The S&P 500 index broke above the level of 2,850 on Tuesday following last Thursday's bounce off 2,800 mark. But will it continue higher? There are still two possible medium-term scenarios - bearish that will lead us towards the February low again, and the bullish one - breakout higher towards 3,000 mark. The latter one is getting more and more real. The S&P 500 index still seems to be "climbing a wall of worries" here:

S&P 500
S&P 500

Short-term Consolidation, Topping Pattern Or Just Pause?

Expectations before the opening of today's trading session are slightly positive, because the index futures contracts trade 0.1% higher vs. their yesterday's closing prices. The main European stock market indexes have been mixed so far. Investors will wait for some economic data announcements: Producer Price Index, Initial Claims at 8:30 a.m., Wholesale Inventories at 10:00 a.m. The broad stock market may extend its short-term consolidation today. There have been no confirmed negative signals so far. However, there are some short-term overbought conditions and stocks trade slightly below the medium-term resistance level.

The S&P 500 futures contract trades within an intraday uptrend, as it retraces its overnight decline. The nearest important level of resistance is at around 2,860-2,865, marked by the recent local highs. On the other hand, support level is at 2,850-2,855, marked by some short-term local lows. The support level is also at 2,845-2,850. The futures contract is now below its short-term upward trend line, as we can see on the 15-minute chart:

15-Minute S&P 500
15-Minute S&P 500

Nasdaq Remains Slightly Below 7,500 Mark

The technology Nasdaq 100 futures contract follows a similar path, as it gets back to its recent local highs this morning. However, the big cap tech stocks gauge is relatively weaker than the broad stock market, as it remains below the late July record high of around 7,530. The nearest important level of resistance is at 7,480-7,500. On the other hand, support level is at 7,400-7,450. The Nasdaq futures contract trades within a short-term consolidation slightly below the level of 7,500, as the 15-minute chart shows:

Nasdaq 100
Nasdaq 100

Amazon at New Record High, Apple Pauses

Let's take a look at Apple's (NASDAQ:AAPL) daily chart (chart courtesy of stockcharts.com). The stock reached yet another new record high on Tuesday at the level of $209.50, but we saw some profit-taking action later in the day. Then it retraced some of its recent rally on Wednesday. Will it continue higher despite some clear short-term technical overbought conditions? There have been no confirmed negative signals so far. The nearest important level of support is now at $190-200, marked by the previous resistance level:

Apple
Apple

Now let's take a look at Amazon.com's (NASDAQ:AMZN) daily chart. It reached new record high yesterday at the level of $1,891.51, following the recent breakout above the price of $1,850. The nearest important level of resistance is now at around $1,900. On the other hand, support level is at 1,850. The stock continues to trade above its medium-term upward trend line, as we can see on the daily chart:

Amazon.com
Amazon.com

Dow Jones Slightly Above 25,500

The Dow Jones Industrial Average extended its short-term uptrend recently, as it broke above the local high of around 25,600. The nearest important level of resistance is now at around 25,800, marked by the late February local high. The blue-chip stocks' gauge is still relatively weaker than the broad stock market, as it trades well below the late January's record high of 26,616.71. There have been no confirmed negative signals so far:

Dow Jones Industrial Average
Dow Jones Industrial Average

The S&P 500 index fluctuated yesterday following Tuesday's move up. The broad stock market got closer to its late January's record high recently. Will the uptrend continue? There have been no confirmed negative signals so far, but we can see some short-term technical overbought conditions.

Concluding, the broad stock market will likely open virtually flat or slightly higher today. We may see some more short-term profit-taking action. Investors will react to the mentioned economic data releases today.

More Uncertainty as Stocks Got Closer to January Record High
 

Related Articles

More Uncertainty as Stocks Got Closer to January Record High

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email