The stock market outlook for Friday April 29 2016 was for stocks to try to rally at the open and then fall back and close lower.
The market moved far lower than I had expected however, although it was certainly profitable for my Spy Put trades.
All three indexes moved lower on Friday but they closed off their lows for the day which was somewhat impressive.
S&P Index Close
The S&P fell to a low of 2052.28 on Friday, which was deeper than I expected. The close though saw the S&P back up to 2065.20. The loss was 10.51 points on the day for a drop of 0.51%.
Dow Jones Index Close
The Dow Jones reached 17,615.98 during the day but rallied back to close down just 57.12 points for a loss of 0.32%. The close was at 17,773.64.
NASDAQ Index Close
The NASDAQ has the worst day among the three major indexes thanks to Apple Stock which continued to slide. The NASDAQ closed down 29.93 points for a loss of 0.62% to close at 4,775.36.
Stock Market Outlook – Advance Decline Numbers
Volume picked up over 300 million shares to reach 4.71 billion on Friday . There were 101 new highs and just 11 new lows. By the close only 39% of all volume was to the upside and 59% was to the downside.
The NASDAQ traded 2.38 billion shares. By the close 36% of that volume was to the upside and 63% was to the downside. There were 56 new highs and 38 new lows.
Volume is starting to pick up but on as investors are starting to take more profits. This will add weakness to the start of trading next week.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook – Apr 29 2016
Stock Market Outlook: Chart Comments:
The S&P closed below the 20 day simple moving average (SMA) intraday but the closing candlestick is often bullish for stocks.
The 50 day simple moving average (SMA) is moving quickly to the 200 day and could cross over it by early this week unless selling intensifies. This would mark another major buy signal if it happens.
The Bollinger Bands are still trending more sideways than up which points to stocks still moving sideways rather than higher. This could change to lower.
Stock Market Outlook: Support and Resistance Levels:
These are the present support and resistance levels. These levels have not changed since January 2015.
2100 is resistance.
2075 is light support which may become resistance shortly, if the market sells lower. Below that is 2050 which is also light support.
Better support is at 2000.
Weak support is at 1970 while stronger support is at 1956 and technically it is more important than 1970 for the market. 1940 is light support as is 1920. 1900 is more symbolic than anything else.
1870 is support. 1840 continues to be support. The 1820 level is light support. The strongest support level is at 1800.
1775 and 1750 are both critical support for the present bull market. While 1775 is important it is 1750 that is the bottom line.
A break of 1750 would mark a severe correction from the all-time high of 2134.72. This would be the biggest correction since the plunge in 2011 of a 20% pullback. A pullback to 1750 from the all-time high would be a drop of 384 points for a decline of 18%. A pull-back of that size would definitely stun investors and bring to question whether the bull market which started in 2009 is finished. From 1750 it is an easy slide to 1600 which was near the market top in 2007.
Stock Market Outlook Technical Signals
Momentum: For momentum I use a 10 period when studying market direction. Momentum is negative and falling.
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 on April 22. The sell signal gained strength on Friday.
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 falling.
Rate of Change: Rate Of Change is set for a 21 period. The rate of change signal is positive and falling.
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.
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 set for the 1 to 3 month S&P 500 chart when I have it set for daily views. The Fast Stochastic is signaling down for stocks.
Stock Market Outlook for Tomorrow – Monday May 2 2016
The technical indicators have not changed on Friday. 4 are negative and moving lower and 2 are positive but also falling.
Historically though the first day of May has been up for stocks in 13 of the last 18 years. The closing candlestick on Friday is also bullish for a bounce back.
For Monday the stock market outlook is for stocks to try to rebound but close negative on the day. If the S&P does close positive it may only be by a very slight advance.
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