Friday Dec 13 saw the SPX push to another new all-time intraday high of 3182 early morning before dipping back below 3160 by 11:30. The index recovered part of the late morning drop and then turned sideways and spent the afternoon trading between 3168 and 3170 in a very tight range. The close saw a slight fractional gain of just 0.23 points to close at 3168.80.
Stock Market Outlook Chart Comments At The Close on Fri Dec 13 2019
The SPX chart continues to be bullish and the Bollinger Bands Squeeze looks ready to unwind with the index pushing higher against the Upper Bollinger Band.
The closing candlestick is bullish for Monday but it is also often a reversal signal for the next couple of days which means we could see some weakness Monday and/or Tuesday.
All the major moving averages are continuing to climb and the index is sitting at its highest level of the year.
Light support is still at 3075 but there is support building at 3100..
Stock Market Outlook review of Fri Dec 13 2019
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is rising and positive.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Mon Dec 2 2019. On Friday a very weak up signal was issued at the close of trading. This is unconfirmed.
- Settings: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9.
Ultimate Oscillator: The Ultimate Oscillator signal is falling although overall it is moving more in a sideways pattern rather than lower.
- Settings: 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.
Slow Stochastic: The Slow Stochastic is back overbought and has an up signal in place.
- Settings: 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.
Relative Strength Index: The RSI signal is moving sideways.
- Settings: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It is often the first indicator to show an overbought or oversold signal.
Rate of Change: The rate of change signal is also moving sideways.
- Settings: 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. With the Rate Of Change, prices are rising when signals are positive. Conversely, prices are falling when signals are negative. As an advance rises the Rate Of Change signal should also rise higher, otherwise the rally is suspect. A decline should see the Rate Of Change fall into negative signals. The more negative the signals the stronger the decline.
Support and Resistance Levels To Be Aware Of:
3150 is resistance
3075 is light support
3030 is light support
3000 is support
2960 is light support
2950 was light support
2900 is light support
2860 is light support
2840 is support
2800 is strong support
2795 is light support
2745 to 2750 is light support
2725 is light support
2700 is light support
Stock Market Outlook for Tomorrow – Mon Dec 16 2019
Only the closing candlestick on Friday points to a potential for the index to close lower on Monday and/or Tuesday.
The majority of the technical indicators are pointing to the index as probably seeing little change on Monday as most of the indicators are pointing sideways, rather than up or down.
The Slow Stochastic and MACD both have up signal for Monday but MACD is not confirmed up just yet.
Monday looks like it could open higher and then dip and turn back sideways with perhaps another slightly higher close.
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