Thursday saw stocks move higher against a backdrop of there being no “bad” news reported on. The stock markets have become entwined with news reports. Down days are also bad news days while up days are good news days.
Thursday was a good news day.
The S&P rose 21.80 points to 2663.99
The NASDAQ Composite rose 71.22 to 7140.25
The Dow Jones Industrial Average rose 293.60 to 24,483.05
Stock Market Outlook Chart Comments At The Close:
The chart overall is still bearish but showing improvement.
The index rose to close above the 21 day moving average but closed below the 100 day moving average.
The closing candlestick was bullish for Friday. The 21 day moving average is still falling below the 100 day which is also bearish.
All the major moving averages are falling except for the 200.
Stock Market Outlook: Technical Indicators Review:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive and rising.
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 Apr 11. That buy signal was confirmed on Thursday, this week.
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 signal is negative but climbing 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 has an up signal in place.
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 is often the first indicator to show an overbought or oversold signal. The RSI signal is rising.
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. With the Rate Of Change, prices are rising when signals are positive. Conversely, prices are falling when signals are negative. As an advance rises the Rate Of Change signal should also rise higher, otherwise the rally is suspect. A decline should see the Rate Of Change fall into negative signals. The more negative the signals the stronger the decline. The rate of change is positive and rising.
Support Levels To Be Aware Of:
2745 to 2750 was light support
2710 was light support.
2700 was good support.
2675 was light support.
2650 is light support and 2620 is also light support.
2600 is good support.
There is good support at the 2550 level from where the market bounced back from the recent correction on Feb 9.
The S&P has light support at 2480. It also has light support at 2450 and good support at 2425. Below that there is some support at 2400, 2380, 2350. 2300 has the most support at present but would represent a full correction as a drop to this level would be 20% and just 5% away from a potential bear market signal.
Stock Market Outlook for Tomorrow – Fri Apr 13 2018
With President Trump fairly silent during the day on Wednesday, the market moved higher. This could change at a moment’s notice. Don’t be surprised by news of a missile attack on Syria which will also sink stocks, probably for a short period only.
Until then though, the outlook is higher for Friday, the 13th. (Scary right!)
Volumes should pick up as there are weekly options expiring on Friday, however I am not expecting a spike higher in volumes.
Stock Market Outlook Archives