The outlook for Thursday was for weakness to continue and the day to turn negative. The S&P was negative for some of the day but turned positive and ended the day with a slight gain.
S&P Index Close
The S&P index did fall just below 2160 mid-morning but that dip was bought into and the market moved higher for the rest of the day. It closed up 3.48 points at 2170.06.
Dow Jones Index Close
The Dow closed down just 15.82 points thanks in large part to Boeing Stock (BA). It closed at 18,456.35.
NASDAQ Index Close
The NASDAQ rallied slightly and moved up 15.17 points to 5154.98.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook: Chart Comments:
The S&P has been moving sideways for 10 trading days. The day ended with another bearish candlestick.
All the major moving averages are moving higher but you can see that a possible Bollinger Bands Squeeze is starting to form. This will either send the index higher or lower.
Stock Market Outlook: Support and Resistance Levels:
These are the present support and resistance levels.
2160 is very light support.
2100 is light support.
2090 is very light support.
2075 is also light support
Below that is 2050 which is light support.
2025 is better support than 2050 through to 2090.
2000 is primary support.
Weak support is at 1970 while stronger support is at 1956 and technically it is more important than 1970 for the market. 1940 is light support as is 1920. 1900 is more symbolic than anything else.
1870 is support. 1840 continues to be support. The 1820 level is light support. The strongest support level is at 1800.
1775 and 1750 are both critical support for the present bull market. While 1775 is important it is 1750 that is the bottom line.
A break of 1750 would mark a severe correction from the all-time high of 2134.72. This would be the biggest correction since the plunge in 2011 of a 20% pullback. A pullback to 1750 from the all-time high would be a drop of 384 points for a decline of 18%. A pull-back of that size would definitely stun investors and bring to question whether the bull market which started in 2009 is finished. From 1750 it is an easy slide to 1600 which was near the market top in 2007.
Stock Market Outlook Technical Signals
Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive and falling back. It is very close to turning negative.
MACD Histogram: 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) issued a buy signal on July 1. The buy signal has been weaker day after day and today again the signal is declining.
Ultimate Oscillator: 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 positive and trying to rise.
Rate of Change: Rate Of Change is set for a 21 period. The rate of change signal is positive and falling back.
Slow Stochastic: For the Slow Stochastic I use the K period of 14 and D period of 3. The Slow Stochastic tries to predict the market direction further out than just one day. The Slow Stochastic is extremely overbought and has a down signal in place.
Fast Stochastic: 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 I have it set for daily views. The Fast Stochasticis is also overbought and has a down signal in place.
Stock Market Outlook for Tomorrow – July 29 2016
The technical indicators are not changed. The outlook remains weak. The indicators are continuing to point to lower days but the dips are being bought constantly by investors. The bullishness in the market remains fairly strong and as such the market will not fall to the downside.
Nonetheless, the outlook is for the S&P to close lower on Friday.
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