Stock Market Outlook for Fri Nov 22 2024 – Bullish and Higher But Dips Likely

Prior Trading Day Summary:

Thursday was an exciting day as stocks like NVIDIA Stock (NVDA) and Palo Alto Networks (PANW) moved lower early in the day and dragged some stocks with them while at the same time stocks like Snowflake (SNOW) and Deere (DE) pushed higher. By the afternoon even NVIDIA Stock (NVDA) was positive and the index moved higher to close positive for the fourth straight day. The SPX ended up 31 points to close at 5948. The SPX is sitting just below 5950 which has been both resistance and support for the rally. Volume rose as the day progressed and reached 4.3 billion, the most this week. There were 242 new 52 week highs, the most since Nov 11. There were also 52 new lows, the lowest this week and on the verge of falling below 50 which members know is a bullish signal.

The NASDAQ had another rough day especially with Alphabet Stock (GOOGL) tumbling 4% on news of the DOJ antitrust case. By the close the NASDAQ had made a comeback to squeeze a positive 6 point close ending the day at 18,972. Volume rose to 7.6 billion shares traded, the second highest volume day this week. 65% of all stocks were rising, which is the best showing since Nov 5 when 71% of all stocks rose. This is another bullish signal although new lows are still elevated and came in today at 162. Overall though, it was a bullish signal.

Let reviews the closin technical signals from Thu Nov 21 2024 to see what to expect for Fri Nov 22 2024.

Stock Market Outlook: SPX Closing Chart For Thu Nov 21 2024

The index failed to break below the 21 day moving average and closed further above it. This is bullish.

The closing candlestick has a long shadow once again which shows there was buying pressure through much of the day. Often this will result in a weak opening on Friday but a higher close.

The 21 day moving average is higher at 5875 This is bullish.

The 50 day moving average is higher at 5803. This is bullish.

The 100 day moving average is rising and closed at 5666 which is bullish.

The 200 day moving average is in an uptrend and closed at 5424 which is bullish.

The Lower Bollinger Band is below the 50 day moving average and starting to turn higher which is bullish. The Upper Bollinger Band is starting to rise which is bullish.

The S&P chart is bullish for Friday except for the long shadow on the candlestick indicating there will be some selling on Friday, so dips are likely.

SPX Stock Market Outlook review of Thu Nov 21 2024

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Fri Nov 22 2024 

Two more support levels were added today following a week of the SPX grinding its way higher. The 5825 and 5850 levels are moved into support zones. This is indicative of the bullishness of stocks. While it is true that more stocks are trading below their 50 day moving average since last week, the past two days have seen stocks regain a footing. Today particularly was strong for the bulls.

On Thursday the Weekly Initial Unemployment Insurance Claims came in lower than expected at 213,000 continuing to suggest strength in the economy. The Philadelphia Fed manufacturing survey was dismal as it fell to -5.5 which was much lower than the expected positive 8.2. Meanwhile existing home sales actually rose more than expected to 3.96 million from 3.95 million. Finally Leading economic indicators rose to -0.3% which was better than the prior -0.5%.

All the economic indicators continue to suggest the market is doing well which means while the Fed might cut rates a quarter of a point in December, there are not urgent signals to advise haste on interest rate cuts. At the same time nothing on Thursday’s economic reports suggest interest rates need to rise again.

Overall it has been a good week for stocks and the technical indicators are turning back to a bullish stance. The chance of a correction in November I think remains slim. While the MACD technical indicator is still pointing lower and momentum suggests that the buying of stocks this week has not been broad but more focused on specific sectors, the remaining technical indicators are positive on the direction being higher to end the week. Even the MACD down signal was crushed on Thursday and we should see that down signal be gone by the start of next week.

For Friday expect a choppy day with dips likely but a higher close. Economic reports on Friday are not expected to affect market direction.

Potential Economic and Political Market Moving Events

Monday:

10:00 Home builder confidence index beat the estimate and rose to 46 from 43.

Tuesday:

8:30 Housing Starts came in lower to 1.31 million from 1.35 million prior

8:30 Building permits were lower than estimated at 1.42 million.

Wednesday:

No economic reports

Thursday:

8:30 Weekly Initial Unemployment Insurance Claims are estimated at 220,000 up from last week.

8:30 Philadelphia Fed manufacturing survey is expected to come in at 6.0 quite a drop from 10.3 prior

10:00 Leading home sales are estimated to have risen to 3.91 million from 3.84 million

10:00 Leading economic index is expected to slip slightly to -0.4% from -0.3% prior

Friday:

9:45 S&P flash services Purchasing Managers’ Index (PMI) is expected to rise slightly to 55.0 from 54.6 prior

9:45 S&P flash smanufacturing Purchasing Managers’ Index (PMI) is expected to rise slightly to 48.8 from 48.5 prior

10:00 Consumer sentiment for November is estimated at 73.5 up very slightly from 73.0 prior