Stock Market Outlook for Fri Jun 15 2018 – Weakness, Choppy Trading But Bias Is Back To Up

Stock Market Summary for Thu Jun 14 2018 

Thursday saw investors undecided on the markets direction. The NASDAQ managed another new intraday all-time high but the Dow closed lower while the S&P pretty well ended the day where it started the day.

Closing Statistics

The S&P rose 6.86 to 2782.49

The NASDAQ Composite rose 65.34 to 7761.04

The Dow Jones Industrial Average fell 25.89 to 25,175.31

Stock Market Outlook Chart Comments At The Close on Thu Jun 14 2018 

Stocks moved primarily sideways on the S&P index on Thursday. This left behind a neutral candlestick which does not point up or down for the following day.

The moving averages are all climbing and the 50 day is now above the 100 day, a significant signal to the upside.

Stock Market Outlook review of Thu Jun 14 2018

Stock Market Outlook: Technical Indicators Review:

Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive and 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 an up signal on May 7. The up signal was pulling back again on Thursday.

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 and trending sideways.

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 is very overbought and has a down signal in place.

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 is often the first indicator to show an overbought or oversold signal.  The RSI signal is rising.

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. 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. The rate of change signal is rising.

Support Levels To Be Aware Of:

2745 to 2750 is light support

2725 is light support.

2700 is support.

2675 is light support.

2650 is light support

2620 is light support

2600 is strong support.

There is good support at the 2550 level from where the market bounced back from the recent correction low on Feb 9.

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 but would represent a full correction as a drop to this level would be 20% and just 5% away from a potential bear market signal.

 Stock Market Outlook for Tomorrow – Fri Jun 15 2018 

Despite the market direction remaining fairly flat on Thursday, the technical indicators have a number of signals that have moved back to the up side as they are back rising again.

While the sideways pattern is always a concern, the 2780 level held up again on Thursday. The 50 day is also now above the 100 and 200 day moving averages which is a significant up signal.

Overall Friday looks to be weak and will probably see a choppy session, but the bias has shifted back to the upside for stocks.

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