Stock Market Outlook for Fri Nov 8 2024 – Overbought – Dips Likely But Higher Close

Prior Trading Day Summary:

On Thu Nov 7 2024 investors continued to pour capital into stocks as the Fed cut interest rates a quarter point as expected.

The S&P rose 44 points with 5 billion shares traded. The index closed at another new high of 5973 while it reached 5983.84 on Thursday. A move to 6000 is likely on Friday.

The NASDAQ soared 286 points to a new all-time closing high of 19,269 on 9.5 billion shares. Intraday the index reached a new all-time high of 19,301.

For the week, the S&P has added 244 points while the NASDAQ has climbed an impressive 1029 points.

Many stocks are now overbought and some weakness on Friday seems possible.

Let’s review the technical signals from Thu Nov 7 2024 to see what they predict for Fri Nov 8 2024.

Stock Market Outlook: SPX Closing Chart For Thu Nov 7 2024

The index traded all day above the Upper Bollinger Band and all major moving averages. This is bullish.

The closing candlestick is bullish for Friday although signaling the market is very overbought. There is a huge gap from Tuesday’s close and Wednesday’s open. Often the market will fail in that gap at some point in a pullback but the chance of it happening on Friday is none.

The 21 day moving average rose on Wednesday and is at 5821. This is bullish.

The 50 day moving average is higher at 5720. This is bullish.

The 100 day moving average is rising and closed at 5605 which is bullish.

The 200 day moving average is in an uptrend and closed at 5369 which is bullish.

The Lower Bollinger Band is now below the 50 day moving average which is bullish. The Upper Bollinger Band is moving higher which is bullish as the Bollinger Bands widen which signals a higher move is still ahead for the index.

The S&P chart is bullish for Friday but is signaling very overbought.

SPX Stock Market Outlook review of Thu Nov 7 2024

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Fri Nov 8 2024 

Many stocks are very overbought and the closing candlestick is signaling that dips are likely on Friday but the index should move above 6000 intraday although it probably won’t close above it. The opening could be lower or flat and some dips may occur in the morning and again late in he day. It has been an incredible week for the country and for stocks. The Fed cutting rates a quarter point on Thursday will work its way into the economy over the next few months and another ate cut is anticipated for December. Fed Chair Powell’s comments about how resilient the economy remains a testament to the consumer and their desire to continue to spend.  Dips are likely on Friday but are opportunities to setup trades as stocks keep a bullish direction. I expect a higher close, but even if the close is slightly lower the outlook for next week is a move above 6000.

Potential Economic and Political Market Moving Events

Monday:

10:00 Factory Orders came in as estimated, down -0.5%

Tuesday:

8:30 Trade deficit came in almost as expected at -$84.4 billion

9:45 S&P final US services PMI came in at 55.0

10:00 ISM Services rose to 56.0 rather than dips as anticipated

Wednesday:

no reports

Thursday:

8:30 Weekly Initial Unemployment Insurance Claims rose to 221,000, up slightly from last week’s 218,000

8:30 Productivity rose to 2.2%, up slightly from 2.1% prior

10:00 Wholesale inventories came in as estimated at-0.1%

2:00 Fed’s Interest rate decision

3:20 Fed Chair Powell’s press conference

3:00 Consumer credit came in at $13.0 billion, up from $8.9 billion prior

Friday:

10:00 Consumer sentiment is expected at 71.0 up slightly from 70.5 prior