Market Direction Outlook For Mar 28 2013

Market Direction today was back to Europe. Rising European bond prices and fear of what will happen on Thursday when banks reopen in Cyprus had investors on edge. Market direction was lower early in the day but managed to snap back. In particular the S&P 500 recovered to close down just 0.92 points. The Dow had a 120 point drop but again the market direction pushed back as investors continue to buy each dip. The Dow closed down just 33.49 points.  The NASDAQ meanwhile closed up  4.04 points.

Market Direction Action for Mar 27 2013

European governments vowed that the tax on bank accounts over 100,000 Euros would not be a template for the future, but I imagine a lot of investors don’t believe it. Bond yields of financially unstable euro zone countries rose especially Italy which moved to 4.77 per cent which is still considerably lower than it was last year when the crisis seemed more pronounced.

As well US February pending home sales rose 5 percent over last year at the same time which was below expectations for 8.7 percent and dampened investor enthusiasm.

Market Direction Closings

The S&P 500 closed at 1562.85, down 0.92 points and the Dow closed at 14,526.16 down 33.49 points. The NASDAQ closed at 3256.52 up 4.04 points.

Market Direction Technical Indicators At The Close of Mar 27 2013

Let’s take a moment now and review the market direction technical indicators at today’s close on the S&P 500 and view the next trading day’s outlook.

Market Direction march 27 2013

For Momentum I am using the 10 period. Momentum is still positive but today’s market direction action has moved momentum toward a neutral stance..

For MACD Histogram I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9. MACD (Moving Averages Convergence / Divergence) is still negative but slowly rising. The sell signal remains active.

The Ultimate Oscillator settings are Period 1 is 5, Period 2 is 10, Period 3 is 15, Factor 1 is 4, Factor 2 is 2 and Factor 3 is 1. These are not the default settings but are the settings I use with the S&P 500 chart set for 1 to 3 months.

The Ultimate Oscillator is still positive and is back climbing reflecting the recovery in the market direction following the morning selling.

Rate Of Change is set for a 21 period. Rate Of Change is still positive but today’s selling had an impact and pushed rate of change lower.

For the Slow Stochastic I use the K period of 14 and D period of 3. The Slow Stochastic is signaling market direction is higher and a bug signal was generated today. This signal needs to be confirmed.

For the Fast Stochastic I use the K period of 20 and D period of 5. These are not default settings but settings I set for the 1 to 3 month S&P 500 chart when it is set for daily. The Fast Stochastic is overbought and continues to point to market direction higher. The buy signal remains active.

Market Direction Outlook And Strategy for Mar 28 2013

The market direction outlook for the final trading day of this shortened week is for the market direction to remain weak. Europe is weighing on investors who want to buy additional stocks and are convinced the market direction is higher, but are afraid to commit in the face of what could be a sell-off if events in Europe should worsen. Europe’s problems are going to remain with the markets for a long time. Look for market direction to move higher when there is little news out of Europe and lower when any bad news arrives no matter how remote.

My outlook is unchanged. Yesterday the outlook was for the market direction to remain up and the selling in the morning was bought and the market direction pushed back for the rest of the day. The strength remains but so do the concerns. Investor nervousness will stay with the markets for the foreseeable future, but I am maintaining my Put Selling trades and continue to look for more opportunities. Market direction then is for some weakness again tomorrow but for the market direction to try to push higher yet again.

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