Wednesday was a bit of a roller coaster day with stocks moving higher and then falling back after the Trump news conference. Then as the afternoon wore on, stocks moved back up.
The day ended with the S&P within easy reach of a new all-time high, the Dow less than 50 points away from 20,000 and the NASDAQ sitting on another new closing high.
S&P Index Close
The S&P index ended the day up 6.42 to 2275.32, which was the high of the day.
Dow Jones Index
The Dow Jones closed up 98.75 points to 19,954.28 below the intraday high of 19,973.42.
NASDAQ Index Close
The NASDAQ closed up 11.83 points to 5563.65 for another new all-time closing high.
Stock Market Outlook
Stock Market Outlook review of Jan 11 2017
Chart Comments At The Close:
The Bollinger Bands Squeeze I discussed over the last couple of night is still continuing. It is still too early to tell which way the squeeze will move. At present the Upper Bollinger Band is continuing sideways while the Lower Bollinger Band is starting to turn slightly lower. While it really is too early into the squeeze to say for sure which way the market will move in the squeeze, at present it looks more like the market will move down rather than up. In the end it could stay sideways into the inauguration.
Today the SPX reached the Middle Bollinger Band and bounced off of it but it left behind a somewhat bearish candlestick. Tomorrow could be weaker. The S&P is still above all the major moving averages including the 21 day moving average which is bullish.
Support Levels To Be Aware Of:
The market has been trying to build support at the 2250 level. There is light support at 2195 but better support is at 2180 and then 2150.
Stock Market Outlook: Technical Indicators:
Stock Market Outlook technical review of Jan 11 2017
Momentum: For momentum I use a 10 period when studying market direction. Momentum is still positive but is continuing to move sideways rather than up or down.
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 a sell signal Dec 23 2016. The sell signal had been losing strength but for the past couple of days it has stayed steady and is still flashing the sell signal.
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 is positive and moving 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 signaling down for stocks and is overbought.
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. The rate of change signal is positive but moving sideways signifying no real change in pricing is expected for the index.
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 often is the first indicator to show an overbought or oversold signal. It is positive and and moving higher.
Fast Stochastic: For the Fast Stochastic I use the K period of 20 and D period of 5. These are not default settings, but settings I use for the 1 to 3 month S&P 500 chart when I have it set for daily views. The Fast Stochastic is signaling down and is also overbought.
Stock Market Outlook for Tomorrow – Thursday Jan 12 2017
For Thursday Jan 12 2017, the technical indicators still have 3 sell or down signals in place. There are 4 positive signals, 3 of which are moving sideways indicating no real change is expected and one, the Relative Strength Index (RSI) that is turning higher which on its own does not signify much change at this point.
Overall the market still appears like it is in limbo waiting for the next earnings period to start and/or the inauguration of the new President. Since banks start reporting on Friday, we could see more action on Friday but for Thursday the outlook is still sideways and the underlying bias is still unchanged at up. So even if Thursday ends up being lower, the general outlook is still up.
Stay FullyInformed With Email Updates
Market Direction Internal Links
Profiting From Understanding Market Direction (Articles Index)
Understanding Short-Term Signals
Market Direction Portfolio Trades (Members)
Market Direction External Links
IWM ETF Russell 2000 Fund Info
Market Direction SPY ETF 500 Fund Info