Prior Trading Day Summary:
On Thursday investors attempted a bounce but it was weak on low volume ahead of tomorrow’s jobs numbers. The bounce managed to reach 4726 but in the final hour of trading the SPX ended down again. The index lost 16 points to close at 4688.
The NASDAQ lost 82 points to close at 14,510.
While Thursday will be governed by the December non-farm payroll numbers, the technical indicators will still play a role.
Let’s review Thursday’s trading action to see the outlook for Friday.
Stock Market Outlook: SPX Closing Chart For Thu Jan 4 2024
The index closed above all major moving averages at the Upper Bollinger Band.
The 21 day moving average is trending sideways which is bearish.
The closing candlestick is bearish but also is pointing to a bounce as being likely for 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 Upper Bollinger Band is starting to turn down which is bearish.
The S&P chart is more bearish than bullish heading into Friday.
Stock Market Outlook review of Thu Jan 4 2024
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is falling and negative.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Tue Jan 2. The down signal was stronger on Thursday.
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Ultimate Oscillator: The Ultimate Oscillator is falling and negative. It is on the verge of oversold readings.
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Slow Stochastic: The Slow Stochastic has a down signal in place and ready to turn negative.
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Relative Strength Index: The RSI signal is falling and negative. It is signaling oversold.
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Rate of Change: The rate of change signal is rising and positive. It is signaling a bounce could occur on Friday.
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Stock Market Outlook: Support and Resistance Levels |
| 4815 is resistance |
| 4800 is resistance |
| 4780 is resistance |
| 4750 is resistance |
| 4720 is resistance |
| 4700 is resistance |
| 4675 is support |
| 4650 is support |
| 4625 is support |
| 4600 is support |
| 4590 is support |
| 4575 is light support |
| 4565 is light support |
| 4550 is support |
| 4535 is support |
| 4520 is support |
| 4500 is support |
Stock Market Outlook for Fri Jan 5 2024
While the morning direction in particular will be determined by the December non-farm payroll numbers, the technical indicators will play a role during the day on Friday.
The closing candlestick is signaling a bounce of some strength should be expected either Friday or Monday.
A number of the technical indicators have fallen into oversold readings and the Rate Of Change indicator is signaling a bounce is likely today.
Potential Economic and Political Market Moving Events
Major economic events this week include the latest Fed minutes on Wednesday at 2 PM and Friday is the December non-farm payroll numbers. Both of these events could swing markets.
Tuesday:
9:45 S&P final manufacturing PMI was expected at 48.2 but came in at 47.9
10:00 Construction spending was expected unchanged at 0.6% but came in weaker at 0.4%
Wednesday:
10:00 Job openings came in as expected at 8.8 million
10:00 ISM manufacturing rose to 47.4%
2:00 Minutes of Fed’s December meeting held no surprises
Thursday:
8:15 ADP employment was expected to be 130,000 but came in at 164,000
8:30 Weekly Initial Unemployment Insurance Claims was expected to be 219,000 but came in at 202,000
9:45 S&P final US services PMI was expected to be unchanged at 51.3 but came in at 51.4
Friday:
8:30 December non-farm payroll report is expected to show 170,000 jobs and an increase in unemployment to 3.8%.
10:00 ISM services are expected to come in at 52.5%
10:00 Factory orders are estimated at 2.5%