Stock Market Outlook for Fri Feb 28 2025 – Deeply Oversold But Still Bearish

Prior Trading Day Summary:

On Thursday stocks started the day higher and attempted a bounce despite higher than expected numbers from the Weekly Initial Unemployment Insurance Claims. Unfortunately comments about tarifffs from President Trump sunk stocks again as investors remain nervous on what most feel is an unknown outcome.

The SPX fell 94 points and ended the day at 5861. The pullback is now down 3.1% from the high made just last Wednesday. 66% of all stocks were falling by the close and the index ended the day at the day’s low.

The NASDAQ lost 530 points as NVIDIA Stock (NVDA) failed to hold the early morning rally and plunged in the afternoon. 7.9 billion shares traded on Thursday with 70% of it moving lower followed by 71% of stocks on the index. This was the biggest one day decline since Jan 27 when the index lost 612 points.

Let’s review the SPX technical indicators from Thu Feb 27 2025 to see what to expect for Fri Feb 28 2025.

Stock Market Outlook: SPX Closing Chart For Thu Feb 27 2025

The index fell below the 100 day moving average and closed at the low. This is bearish although a bounce is likely with the index down 3.1% from its high from last week.

The closing candlestick no shadows, but indicates a bounce attempt is probable.

The 21 day moving average is falling and closed at 6044 which is bearish.

The 50 day moving average is falling and closed at 6000 which is bearish.

The 100 day moving average is falling and closed at 5917 which is bearish.

The 200 day moving average is rising and closed at 5702 which is bullish.

The Lower Bollinger Band is falling which is bearish at present. The Upper Bollinger Band is trending higher which signals the Bollinger Bands Squeeze is over and stocks are falling. This is bearish.

For Friday the SPX chart is bearish but a bounce is likely either today or early next week.

SPX Stock Market Outlook review of Thu Feb 27 2025

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Fri Feb 28 2025 

For Friday stocks are very oversold and a bounce is expected. The problem is sentiment has quickly changed to negative and that is pushing stocks lower. As stocks continue to fall, more investors sell out.

On Friday we get the Personal Income and Personal Consumption Expenditures. The SPX is deeply oversold but stocks can stay oversold longer than many investors imagine. That said, if there is no bounce on Friday, expect one at the start of next week.

Potential Economic and Political Market Moving Events

Monday:

No events

Tuesday:

9:00 S&P Case-Shiller home price index rose more than expected to 4.5%

10:00 Consumer confidence was weaker, coming in at 98.3

Wednesday:

10:00 New home sales were lower than estimates, coming in at 657,000, down from 734,000 prior.

Thursday:

8:30 Weekly Initial Unemployment Insurance Claims came in well above estimated at 242,000

8:30 Durable goods orders rose to 3.1% instead of 2.0% expected

8:30 GDP is estimated unchanged at 2.3%

10:00 Pending home sales rose only slightly by -4.9%, up from -5.5% prior.

Friday:

8:30 Personal income is estimated unchanged at 0.4%

8:30 Personal spending is estimated to have fallen to 0.1% from 0.7% prior

8:30 PCE Index is estimated unchanged at 0.3%

8:30 PCE year-over-year is estimated at 2.5% down slightly from 2.6% prior

8:30 Core PCE is estimated at 0.3% up from 0.2% prior

8:30 Core PCE year-over-year is estimated to have fallen slightly to 2.6% from 2.8% prior