What Happened On Thu Dec 7 2017
We got the bounce that was expected ahead of the non-farm payroll numbers on Friday. Unemployment claims fell to a 5 week low which again is bullish for stocks and the economy. All three indexes moved higher with the NASDAQ gaining the most at half a percent for the day.
Closing Statistics for Thu Dec 7 2017
S&P 500 Index Close
The S&P index ended up 7.71 to 2636.98
Dow Jones Index Close
The Dow Jones ended up 70.57 to 24,211.48
NASDAQ Index Close
The NASDAQ closed up 36.47 to 6812.84
Stock Market Outlook – Review of Dec 7 2017
Chart Comments At The Close:
On Thursday the S&P gained 7.71 points to close off the high of the day but well above yesterday’s close. It is now moving below the Upper Bollinger Band and above the 21 day moving average. All three major indexes are continuing to rise and both the Upper Bollinger Band and Lower Bollinger Band are widening which normally indicates more upside ahead. The closing candlestick is bullish for Fri Dec 8 2017.
Stock Market Outlook – Dec 7 2017
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive and back 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 Nov 28. The up signal is still losing strength.
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 positive but down slightly and almost neutral.
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 a down signal in place for Friday.
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 turned back up on Thursday.
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 positive and starting to turn higher which may signal higher prices are ahead.
Support Levels To Be Aware Of:
The 2600 is building some light support.
There is good support at the 2550 level which could assist in keeping the index up for December.
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.
Stock Market Outlook for Tomorrow – Fri Dec 8 2017
Thursday’s market was as expected. The bounce is setting the market up for the non-farm payroll numbers, due out at 8:30 AM. In the past these numbers have been market movers, but lately the movements after the numbers are released have been more subdued. Still though, the technical indicators are 5 to 1 in support of the market moving higher on Friday. Sometimes though even with good numbers, investors can sell stocks lower once the numbers are released. Technically though the bias is still higher. You can tell from the differing comments that Friday is basically, all about the jobs numbers.
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