Stock Market Outlook for Fri Dec 29 2023 – Neutral For Year-End With Possible Lower Close

Prior Trading Day Summary:

On Thursday trading volumes remained poor on New York with just 2.7 billion shares traded for a second day. On the NASDAQ volumes fell to a still respectable 5.2 billion shares.

The SPX made a new 52 week intraday high of 4793 before closing up 1.77 to slightly below it at 4783.

The NASDAQ closed down 4 points to 15095.

The technical indicators as you can see below, are continuing to show weakness is growing which could mean the start of January may not be as strong as investors are hoping for.

Let’s review the closing technical indicators from Thu Dec 28 2023 to see what to expect for the final trading day of 2023.

Stock Market Outlook: SPX Closing Chart For Thu Dec 28 2023

The index closed above all major moving averages and just below the Upper Bollinger Band. The SPX index made a new 52 week intraday high today of 4793 and is within easy striking distance of the all-time intraday high of 4818.62 made Jan 4 2022. The all-time closing high was 4796.56 on Jan 3 2022.

The 21 day moving average is rising further, which is also bullish. It has been in a steady rise without even a dip since Nov 22, a full month as of last Friday (Dec 22).

The closing candlestick is still bullish for Thursday but also signals dips should be expected on Friday.

The 50 day moving average is above the 100 day and still climbing which is bullish.

The 100 and 200 day moving averages are climbing which is bullish.

The Lower Bollinger Band has moved back above the 50 day moving average which is bearish.

The S&P chart is bullish heading into Friday with some reservations.

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Fri Dec 29 2023 

For Friday the Moving Average Convergence / Divergence is continuing to lose strength and is now almost on the verge of a down signal. Momentum is falling which is understandable as the market is drifting more sideways than actually moving steadily higher. The other technical indicators are a bit mixed but overall they are still bullish.

The bond market closes early today which often assists the bulls.

The final trading day of the year usually has very low volumes and a move a lot higher or lower is unusual. For that reason the outlook is neutral to possibly a lower close. A flat close though will not affect the start of 2024.

Happy New Year to all Investors!

Teddi

Potential Economic and Political Market Moving Events

Major economic events this week few with most on Thursday with retail and whole inventories and pending home sales. Bond markets are closed early on Friday.

Tuesday:

9:00 Case-Shiller home price index came in at 5% indicating some inflationary pressure on prices

Wednesday:

No events

Thursday:

8:30 Weekly Initial Unemployment Insurance Claims were expected to rise to 215,000 but rose to 218,000 which supports the outlook for an early Fed rate reduction

8:30 Advanced trade balance in goods was expected at -89.6 Billion but surprised with a strong $90.3 billion which supports inflationary outlook.

8:30 Advanced retail inventories was unchanged at -0.1%

8:30 Advanced wholesale inventories were -0.2% virtually unchanged

10:00 Pending home sales was estimated to rise to 1% but instead was flat

Friday:

9:45 Chicago Business Barometer is expected to fall to 50 from 55.8