Friday August 11 2017 saw stocks spend much of the day with slight gains but the close saw the NASDAQ push higher with the Dow Jones and S&P sporting smaller gains ahead of the weekend.
S&P Index Close
The S&P index ended the day up 3.11 to 2441.32.
Dow Jones Index Close
The Dow Jones ended up 14.31 to 22,858.32.
NASDAQ Index Close
The NASDAQ closed up 39.68 to 6256.56
Stock Market Outlook
Stock Market Outlook review of Aug 11 2017
Chart Comments At The Close:
The S&P tried to bounce on Friday and left behind a bullish candlestick by the close. The index closed below both the 21 day and 50 day moving averages and just below the Lower Bollinger Band. This usually if followed by a bounce attempt and then the market either continues the bounce or pulls back. The bounce on Friday was poor and the chart indicates a better bounce attempt is probably set for Monday.
All the major indexes are climbing higher but you can also see that the Bollinger Bands which were moving toward a possible Bollinger Bands Squeeze are beginning to signal that there will not be a squeeze.
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is negative and trying to move higher.
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 Aug 3. The sell signal is gaining strength and so is the MACD histogram which is the barchart just below the MACD signal lines. This is quite bearish.
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 negative and falling toward being oversold.
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 was is falling lower with a strong sell signal but nearing oversold readings.
Relative Strength Index: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It often is the first indicator to show an overbought or oversold signal. The RSI signal is oversold and tried to bounce back on Friday.
Rate of Change: Rate Of Change is set for a 21 period. This indicator looks back 21 days and compares price action from the past to the present. The rate of change signal is negative but trending sideways which often indicates lower prices will not be seen on the following day.
Support Levels To Be Aware Of:
The market has developed light support at 2450 and good support at 2425. There is also light support at 2400, 2380, 2350 and 2300.
Stock Market Outlook for Tomorrow – Mon Aug 14 2017
So far this pullback has not tested the 2425 level. Monday looks like the market will attempt a stronger bounce. Usually after this type of selling we could see more than a day or the market trying to move higher before more selling returns.
Monday should see the markets rally in the morning but then turn sideways over the lunch hour. The close looks to be positive for Monday but watch for any late in the day selling that sends the index to just a slight gain by the close. That will be a bearish sign for Tuesday. At present a lot still depends on the rhetoric over North Korea. Stay cautious but expect a bounce and a positive close for Monday.
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