The outlook for Thursday was for stocks to remain to the upside. With the US dollar pulling back slightly, stocks moved higher and ther S&P neared the highs of late December. The push higher today saw more volume enter the move higher. This could be the break out to challenge the all-time high in the SPX that so many investors have anticipated.
Advance Decline for Feb 12 2015
Volume was moved up 200 million shares to 3.8 billion. A lot of that volume came as the S&P broke above 2075 which was support from late December. 82% of all volume was to upside and 163 new highs were made and only 11 new 52 week lows.
Market Direction Closings For Feb 12 2015
The S&P closed at 2,088.48 up 19.95. The Dow closed at 17,972.38 up 110.24. The NASDAQ closed at 4,857.61 up 56.43
Market Direction Technical Indicators At The Close of Feb 12 2015
Let’s review the market direction technical indicators at the close of Feb 13 2015 on the S&P 500 and view the market direction outlook for Feb 13 2015.
Market Direction Technical Analysis for Feb 12 2015
Stock Chart Comments:
The push higher today has the S&P at the Upper Bollinger Band and show signs it will break to the old all-time highs. The doji-cross candlestick we saw at the close on Wednesday may show up on Friday although with Monday being a holiday, we may not see weakness until Tuesday. The 2075 is back supporting the rally but it is very weak support and will easily break. The market needs more time to rebuild at these levels.
Support and Resistance Levels:
These are the present support levels.
2075 is light support. Below that is 2050 which is light support. Stronger support is at 2000 which has repeatedly held the market up throughout each recent pullback.
Weak support is at 1970. Stronger support is then at 1956.
1870 and 1840 are both levels with strong enough support to delay the market falling and should see a sideways action attempt while investors decide whether to sell or buy.
The other two support levels are 1775 and 1750. I have explained that these two are 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 most recent high. This would be the biggest correction since April 2012. A pull-back of that size would definitely stun investors at this point and it is not something I am anticipating at present.
Momentum: For Momentum I am using the 10 period. Momentum is climbing and positive.
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 weak buy signal Feb 4. MACD continued higher today.
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 moving sideways.
Rate of Change: Rate Of Change is set for a 21 period. The Rate Of Change is turned up and and supporting the trend higher.
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 still overbought and still signaling higher for stocks.
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 it is set for daily. The Fast Stochastic is signaling up for stocks and is also overbought.
Market Direction Outlook for Feb 13 2015
Technically the indicators are all pointing to higher prices. Stocks meanwhile are now overbought but there is still some room to the upside. The only hold back could be the doji-cross candlestick from Wednesday. I won’t be surprised to see some weakness on Friday but a positive close.
The outlook is definitely up at the present time for stocks. Monday is a holiday and I would anticipate stocks closing up to end the week before the long weekend.
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