Day’s Summary
On Friday stocks tried a rebound which saw the index reach 4540 before sellers stepped back in. Volume picked up in the afternoon and the index tumbled below 4500 to end the day down 23 p points at 4478.
The NASDAQ closed down 50 points at 13,909.
Volumes were slightly above average for what we have seen in 2023. The afternoon selling was fairly relentless which was disappointing to see.
Let’s review the technical indicators from the close on Friday to see what to expect for Friday’s trading.
Stock Market Outlook: SPX Closing Chart For Fri Aug 4 2023
The index closed below the 21 day moving average for a second day. While this is bearish, it also is indicative of a bounce coming.
The closing candlestick on Friday also points to a potential bounce.
The 21 day moving average is turning sideways while the 50, 100 and 200 day moving averages are continuing to climb which is bullish.
The Lower Bollinger Band rose above the 50 day moving average which is bearish. The Upper Bollinger Band is turning lower which is also bearish.
Overall the index is still bullish and shows signs of a potential bounce after 4 days of selling.
Stock Market Outlook review of Fri Aug 4 2023
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is fallingg and negative.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Thursday Jul 27. On Fri Aug 4 2023 the down signal gained a lot more strength.
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Ultimate Oscillator: The Ultimate Oscillator is falling, negative and entering oversold.
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Slow Stochastic: The Slow Stochastic has a down signal in place. It is oversold.
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Relative Strength Index: The RSI signal is falling and now oversold.
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Rate of Change: The rate of change signal is rising which often indicates a bounce is coming.
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Stock Market Outlook: Support and Resistance Levels |
| 4600 is resistance |
| 4575 is resistance |
| 4550 is resistance |
| 4525 is resistance |
| 4500 is support |
| 4485 is support |
| 4470 is support |
| 4450 is support |
| 4435 is support |
| 4420 is support |
| 4400 is support |
| 4390 is support |
| 4370 is support |
| 4350 is support |
| 4340 is support |
| 4325 is support |
| 4310 is support |
| 4300 is support |
| 4290 is support |
| 4275 is support |
| 4250 is support |
| 4240 is support |
| 4225 is support |
| 4210 is support |
| 4200 is good support |
Stock Market Outlook for Mon Aug 7 2023
For Monday the technical indicators are showing the market as oversold and nearing a bounce attempt. Friday’s bounce didn’t have a lot of conviction. Many investors are still holding back and waiting to see if prices can fall lower before jumping back into stocks. After the selling last week the SPX is down 110 points or roughly 2.4%. This is not much of a decline and a lot of investors are hoping for at least a 5% decline. With many of the technical indicators already signaling very oversold, we may not see a 5% correction at present.
For Monday I am expect a bounce attempt and a probable higher close. On Thursday investors get the latest CPI numbers. Many analysts are expecting a slight decline to 4.7% from 4.8% year-over-year. If wrong, watch for stocks to tumble lower. If the number however is better, stocks will move higher quickly.
Potential Economic and Political Market Moving Events
The big event this week is on Thursday with CPI numbers
Monday:
3:00 Consumer credit