Friday was a rather see-saw day following the release of August’s non-farm payroll numbers. At the outset of the day, investors thought the numbers were weak enough to delay any thought of the Federal Reserve raising interest rates in September. By the close of the day, investors were not as sure with a number of large analytical firms indicating they felt the jobs numbers were strong enough to warrant the Fed raising rates in September. This dampened the rally although all three indexes still finished with decent gains on the day.
Tuesday may see a jump at the start of trading with the news this evening of Bayer raising its bid for Monsanto to $127.50 a share. While just 2 percent higher than their previous bid, it still may be enough to get investors a bit more enthused to pick up stocks. As well the Labor Day long weekend is over and trading volumes are expected to increase.
S&P Index Close
The S&P index rose 9.12 points for a gain of 0.42% to close at 2179.98.
Dow Jones Index Close
The Dow Jones gained 72.66 points for an advance of 0.39% to close at 18,491.96.
NASDAQ Index Close
The NASDAQ gained 22.69 points or 0.43% to close at 5,249,90.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook – Sept 2 2016
Stock Market Outlook: Chart Comments:
The SPX closed below the 20 day simple moving average again on Friday after touching the Lower Bollinger Band. The closing candlestick however is bullish for Tuesday’s market.
All the major moving averages are continuing to climb although the 200 day moving average is starting to turn sideways as the market continues to move sideways.
You can see the Bollinger Bands Squeeze is continuing to tighten. I am expecting a change sometime this week.
Stock Market Outlook: Support and Resistance Levels:
These are the present support and resistance levels.
The market is trying to build some support at the 2180 level. At present this is now resistance.
2160 is very light support.
2150 is support
2125 is 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.
Stock Market Outlook Technical Signals
Momentum: For momentum I use a 10 period when studying market direction. Momentum is negative but trying to rise.
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 sell signal on August 1. That sell signal was active and slightly less strong on Friday as the market advanced.
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 rising.
Rate of Change: Rate Of Change is set for a 21 period. The rate of change signal is neutral to positive.
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 has an up 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 has am up signal in place.
Stock Market Outlook for Tomorrow – Sep 6 2016
For Tuesday Sep 6, we should begin to see volume start to return to more normal levels as Labor Day ends. Technically there are now 4 positive indicators that are rising and two negative indicators that are only slightly weak.
This places the market in an upward bias for Tuesday although we could see some weakness in the morning to start the day.
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