Stock prices went sideways on Friday despite the initial negative reaction to jobs data. Will they get back to highs?
The S&P 500 index lost 0.12% on Friday after opening much lower on better-than-expected monthly Nonfarm Payrolls release. The market extended its short-term consolidation, as it remained above the 4,000 level. On Wednesday the S&P 500 rallied over 3% after Jerome Powell’s dovish speech . Basically all asset classes rallied including gold , silver and oil .
This morning the S&P 500 will likely open 0.5% lower. So it may see more short-term uncertainty. Investors will be waiting for the important ISM Services PMI release at 10:00 a.m. The index continues to trade above its two-month-long upward trend line, as we can see on the daily chart:
Futures Contract Remains Close to Local High
Let’s take a look at the hourly chart of the S&P 500 futures contract. It continues to trade along the recent local highs and above the support level of around 4,050. There have been no confirmed negative signals so far.
Conclusion
The S&P 500 index keeps fluctuating since its Wednesday’s 3% rally. On Friday the market opened lower following better-than-expected jobs data release, but it closed virtually flat. Today we may see more short-term uncertainty. It still looks like a consolidation within an uptrend.
Here’s the breakdown:
- Stock prices remained close to their local highs on Friday, as the S&P 500 extended a short-term consolidation.
- We may see some more uncertainty this morning, as investors await economic data.
Thank you.
Paul Rejczak,
Stock Trading Strategist