I had expected dips on Thursday but I did expect the index would close slightly higher. Instead investors seemed surprised by the Weekly Initial Unemployment Insurance Claims which showed another 3.5 million unemployed. Overall though it is the strong overbought situation that saw investors take advantage of the index being above 2900 to sell-off and raise some capital. A lot of analysts are now labeling Wednesday’s rally as the top to the recent rally. Whether right or wrong, it has been an impressive rally and dips that will probably last longer than a single day should take the index back down to the 2800 level.
Stock Market Outlook Chart Comments At The Close on Thu Apr 30 2020
The SPX chart continues to be bearish with 6 sell signals in the chart. On Thursday the index closed at the 100 day moving average.
The 200 day moving average is still leading the market, which is typical in a bear market. It is followed closely by the 100 day and the 50 day. The 50 day is falling quickly and the 21 day reached the 50 day on Thursday. A move above the 50 day would be a bullish signal once it occurs.
The closing candlestick on Thursday is bearish for Friday. It is signaling the market may have reached an interim peak just below the 200 day moving average.
The Upper Bollinger Band is turning back up while the Lower Bollinger Band is also turning up.
Stock Market Outlook review of April 30 2020
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is falling and positive.
- 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 March 26. The up signal was weaker on Thursday.
- 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 rising 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 a down signal in place and 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 falling and signaling 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 turned sideways for a third day, which now indicates prices may be about to change.
- 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:
2900 is resistance
2860 is light support
2840 is light support
2800 is good support
2725 is light support
2700 is light support and marked a drop of 20.4%.
2675 is light resistant
2650 is light support
2625 is light support
2600 is support
2550 is light support
2500 was good support and marked a correction of 26.3%
2344 is the next level of support and marks a 30.9% correction.
2191 was the market low on March 23 and most analysts believe this is the low point we will see.
2100 is light support
2000 is good support and marks a drop of 1393 points for a 41% correction. Some analysts believe the index will fall this low before the bear market ends.
Stock Market Outlook for Tomorrow – Fri May 1 2020
For Friday the signals are advising we will see a negative day. The technical indicators are pointing to an overbought market that needs to find fresh buyers if it is to move higher.
For the first day of May however, the S&P is set to see weakness and move lower.
Stock Market Outlook Archives
Stock Market Outlook For Wed May 6 2026 – Choppy But Higher Still
Morning Investing Strategy Notes for Tue May 5 2026
Stock Market Outlook For Tue May 5 2026 – Overbought and Lower
Morning Investing Strategy Notes for Mon May 4 2026
Stock Market Outlook For Mon May 4 2026 – Dips Likely With Possible Lower Close
Morning Investing Strategy Notes for Fri May 1 2026
Stock Market Outlook For Fri May 1 2026 – Overbought But Higher
Morning Investing Strategy Notes for Thu Apr 30 2026
Stock Market Outlook For Thu Apr 30 2026 – Dips Likely Possible Lower Close
Morning Investing Strategy Notes for Wed Apr 29 2026
Stock Market Outlook For Wed Apr 29 2026 – Choppy But Higher Ahead Of More Earnings
Morning Investing Strategy Notes for Tue Apr 28 2026
