On Thursday stocks were boosted by higher numbers of Weekly Initial Unemployment Insurance Claims which jumped 28,000 over last week, well beyond estimates. The increase fit well with the outlook that the Fed will pause interest rates next week. This pushed stocks to try once again to reach 4300. By the close the S&P rose 26 points to close at 4293, the highest level since August 2022.
The NASDAQ rose 133 points to end the day at 13238.
Let’s review the SPX closing technical indicators from Thu Jun 8 2023 to see what to expect for Fri Jun 9 2023.
Stock Market Outlook Chart Comments At The Close on Thu Jun 8 2023
The index closed higher on Thursday nearing the 4300 level. The closing candlestick is bullish for Friday.
The SPX continues above the 21 day moving average and is just inside the Upper Bollinger Band. This is bullish.
The 100 day moving average continued higher on Thursday and moving further away from the Lower Bollinger Band. This is bullish
The Lower Bollinger Band is turning lower which is bullish.
The 21, 50, 100 and 200 day moving averages are rising which is bullish.
The S&P chart is more bullish than bearish but continues to warn that the market is overbought.
There are 7 up signal since January and no down signal in the chart.
Stock Market Outlook review of Thu Jun 8 2023
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is rising and positive. It is nearing overbought readings.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Friday May 26. The up signal was strong on Thursday. The MACD histogram was also strong.
- 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 is unchanged and positive.
- 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 has an up signal in place. It is overbought.
- 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 positive. It is 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 rising indicating the index will be higher on Friday.
- 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 and Resistance Levels To Be Aware Of:
4325 is resistance
4310 is resistance
4300 is resistance
4290 is resistance
4275 is resistance
4250 is resistance
4240 is resistance
4225 is resistance
4210 is resistance
4200 is resistance
4190 is resistance
4180 is support
4175 is support
4150 is support
4135 is support
4125 is support
4100 is support
Stock Market Outlook for Fri Jun 9 2023
The technical indicators are bullish for Friday as investors believe the Fed will not raise interest rates next week after Thursday’s Weekly Initial Unemployment Insurance Claims rise.
The S&P shot higher on Thursday, coming within a couple points of 4300 before closing at 4293.
For Friday there are no economic reports being released. The index is poised to move higher and close above 4300.
Potential Economic and Political Market Moving Events
There are no reports or events due or on Friday.