November 29, 2021 (Investorideas.com Newswire) The S&P 500 sold off on Friday after news about the new Covid variant. Today we will likely see a rebound but the short-term picture remains bearish.
For in-depth technical analysis of various stocks and a recap of today’s Stock Trading Alert we encourage you to watch today’s video.
The S&P 500 index lost 2.27% on Friday, Nov. 26, as investors reacted to the news about new Covid variant detected in South Africa. The market broke below its recent local lows and it got away from the 4,700 level. The Friday’s trading action looked like a meaningful downward reversal.
The nearest important support level is now at 4,550-4,580. On the other hand, the resistance level is at 4,650, marked by the recent local lows. The S&P 500 retraced most of its early November advance, as we can see on the daily chart (chart by courtesy of http://stockcharts.com):
Nasdaq 100 Fell Closer to 16,000
Let’s take a look at the Nasdaq 100 chart. The technology index remained relatively stronger than the broad stock market on Friday, as it didn’t break below the early November local low. However, it got close to the 16,000 level and it retraced almost 800 points from its last Monday’s new record high of 16,764.85. The index closed above the 16,000 mark on Friday, as we can see on the daily chart:
Apple Is At the Previous High
Let’s take a look at biggest stock in the S&P 500 index: AAPL. Apple accelerated its uptrend a week ago on Monday and it reached the new record high of $165.70. However, it retraced almost all of its intraday advance that day. On Friday it got back to a potential support level of around $157. For now, it looks like a downward correction.
The S&P 500 index is expected to open 1.0% higher this morning, as global markets are shrugging off the new Covid fears. We will likely see an intraday consolidation following higher opening. The broad stock market index may enter a flat correction within a short-term downtrend.
Here’s the breakdown:
The S&P 500 traded within a short-term topping pattern last week and on Friday it suffered an over 2% sell-off.
A speculative short position is still justified from the risk/reward perspective.
We are expecting a 5% correction.
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