Stock prices remain very volatile, as the Ukraine conflict keeps dominating headlines. Will the market reverse its downtrend?
The S&P 500 gained 2.57% on Wednesday, Mar. 9, as it retraced some of the recent decline. The broad stock market’s gauge got back to the 4,300 level after bouncing from its Tuesday’s low of 4,157.87. On Feb. 24 the index fell to the local low of 4,114.65 and it was 704 points or 14.6% below the January 4 record high of 4,818.62. There’s still a lot of uncertainty concerning the ongoing Ukraine conflict.
The nearest important resistance level is now at 4,300, and the next resistance level is at 4,350-4,400, among others. On the other hand, the support level remains at 4,150-4,200. The S&P 500 index continues to trade above the recently broken downward trend line, as we can see on the daily chart (chart by courtesy of http://stockcharts.com):
Futures Contract – More Consolidation
Let’s take a look at the hourly chart of the S&P 500 futures contract. Recently it broke below the short-term consolidation. On Tuesday it fell to around 4,150, before bouncing back to the 4,200-4,250 level.
We are still maintaining our long position, as we are expecting an upward correction from the current levels (chart by courtesy of http://tradingview.com):
Conclusion
The S&P 500 index bounced yesterday, but this morning it is expected to open lower. We will likely see some more news-driven volatility. For now, it looks like an upward correction but it may also be a more meaningful upward reversal.
Here’s the breakdown:
- The S&P 500 index retraced some of the recent decline, but we may see more volatility.
- We are maintaining our long position.
- We are expecting an upward correction from the current levels.