S&P 500 Below the Important 4,200 Mark – Will Uptrend Continue?
Stocks extend a short-term consolidation following their recent rally – is this just a flat correction?
The S&P 500 index lost 1.11% on Wednesday, as it retraced most of the Tuesday’s rally. The broad stock market continues to fluctuate after its last week’s advance following the Fed’s Rate Decision, earnings and economic data releases. On Thursday the index reached new medium-term high of 4,195.44, and on Tuesday it fell to the local low of 4,088.39, before getting back closer to the important 4,200 level. Recently the broad stock market’s gauge was extending its bounce from January 19 local low of 3,885.54.
The S&P 500 index will likely open 0.8% higher this morning, so it may get closer to the important 4,200 level again. Last week the S&P went the highest since late August of 2022, as we can see on the daily chart:
Futures Contract Remains Above the Trend Line
Stocks will likely gain at the opening of today’s trading session, and the S&P 500 index may get closer to the 4,200 level again. So we’ll see more short-term uncertainty. For now, it looks like a relatively flat correction within an uptrend.
Here’s the breakdown:
- The S&P 500 index remains within a short-term consolidation following the recent rally.
- Stock prices are expected to open higher, but there may be more uncertainty, as the index gets closer to the important 4,200 level.
- In my opinion, the short-term outlook is neutral.
Stock Trading Strategist