The U.S. stock market indexes lost between 0.3% and 0.5% on Friday, following higher opening of the trading session, as investors were worried about Syrian conflict escalation. The S&P 500 index retraced some of last week’s uptrend and it currently trades 7.5% below its January 26 record high of 2,872.87. Both, Dow Jones Industrial Average gained and the technology Nasdaq Composite lost 0.5% on Friday.
The nearest important level of resistance of the S&P 500 index remains at around 2,670-2,680, marked by last weeks’ local highs. The resistance level is also at 2,695-2,710, marked by March 22 daily gap down of 2,695.68-2,709.79. On the other hand, the nearest important level of support is at around 2,645, marked by Friday’s daily low. The next support level is at 2,635-2,640, marked by local lows.
Stocks reversed their medium-term upward course following whole retracement of January euphoria rally. Then the market bounced off its almost year-long medium-term upward trend line, and it retraced more than 61.8% of the sell-off within a few days of trading. The uptrend reversed in the middle of March, and stocks retraced almost all of their February – March rebound. The index got back down to its medium-term upward trend line. There are still two possible future scenarios. The bearish one, leading us to February low or lower after breaking below medium-term upward trend line, and bullish: medium-term double top pattern or breakout higher. The market was about to break lower over a week ago, but here we are again – closer to breaking higher:
At Recent Local Highs
The index futures contracts trade 0.5% higher vs. their Friday’s closing prices right now. The main European stock market indexes have been mixed so far. It means that the expectations before the opening of today’s trading session are positive. Will stocks take another attempt at breaking above their short-term consolidation? It may happen if sentiment further improves ahead of coming quarterly earnings releases and today’s economic data announcements: Retail Sales, Empire State Manufacturing Index at 8:30 a.m., Business Inventories, NAHB Housing Market Index at 10:00 a.m.