Wednesday was a half day but volume was more indicative of a full day of trading. With investors determined that the Fed will cut interest rates as early as July, they pushed the indexes higher on Wednesday ahead of the July 4th holiday. The S&P is on the verge of breaking 3000 on Friday.
Stock Market Outlook Chart Comments At The Close on Wed Jul 3 2019
The index closed at the Upper Bollinger Band and above all the major moving averages. The closing candlestick was bullish for Friday. The Bollinger Bands still look like they may form into a Bollinger Bands Squeeze sometime next week.
The buy signal from July 1 with the 21 day moving above the 50 day, is gaining strength.
The 200 day moving average has now moved above the 2800 level which is bullish.
The chart is very bullish.
Stock Market Outlook review of Wednesday Jul 3 2019
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is positive and rising.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Thursday June 6. The up signal was stronger on Wednesday.
- Settings: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9.
Ultimate Oscillator: The Ultimate Oscillator signal is positive and still rising.
- Settings: 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.
Slow Stochastic: The Slow Stochastic signal has an up signal in place.
- Settings: 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.
Relative Strength Index: The RSI signal is rising and overbought.
- Settings: 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.
Rate of Change: The rate of change signal is falling back which indicates indecision for Friday, whether stocks will rise or fall.
- Settings: 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.
Support Resistance Levels To Be Aware Of:
2950 is resistance
2900 is light support
2860 is better support
2830 is light support
2800 is strong support
2795 is light support
2745 to 2750 is light support
2725 is light support
2700 is light support
2675 is light support
2650 is support
2625 is light support
2600 is support.
There was good support at the 2550 level which is back to being support.
The 2500 level is support.
The S&P has light support at 2480 and better support at 2450.
There is good support at 2425.
Below that there is some support at 2400, 2380, 2350.
Stock Market Outlook for Tomorrow – Fri Jul 5 2019
For Friday all the indicators are still positive. While the unemployment report will control the market movement for Friday and possibly the start of next week, the indicators show that the move higher in the S&P still has further to climb. That means any dip after the unemployment report is released, will be short-lived.
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