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Stock Market Outlook for Mon Jun 10 2024 – Weakness – Dips Likely

Jun 10, 2024 | Stock Market Outlook

Weakness Dips LikelyPrior Trading Day Summary:

On Friday the May non-farm payroll numbers came in stronger than expected but the unemployment rate still rose to 4%. The day’s trading became mixed as investors tried to decide whether the report was negative or positive for stocks. The numbers seemed to suggest the Fed would hold off any interest rate cut following this strong payroll number.

The S&P closed down just 6 points to close at 5347. The NASDAQ closed down 40 points at 17,133.

For the upcoming week, investors get the latest Fed decision on interest rates, consumer price numbers, producer price reports and consumer sentiment. This will be a busy week which could potentially see volatility.

Let review the closing technical signals from Fri Jun 7 2024 to see what to expect for Mon Jun 10 2024.


Stock Market Outlook: SPX Closing Chart For Fri Jun 7 2024

The index closed above the 21 day moving average, touching the Upper Bollinger Band. This is bullish.

The closing candlestick is neutral but the long shadow indicates a good chance there will be some selling on Monday.

The 21 day moving average is still climbing continuing the latest up signal.

The 50 day moving average is climbing which is bullish.

The 200 day moving average is still climbing. The 200 day is at 4871 which is bullish and the 100 day is also climbing to 5085.

The Lower Bollinger Band is now above the 50 day moving average. The Upper Bollinger Band is turned higher as the SPX is in a Bollinger Bands Squeeze.

The S&P chart is bullish and the Bollinger Bands Squeeze now looks like stocks will move higher out of the squeeze.

SPX Stock Market Outlook review of Fri Jun 7 2024 – chart courtesy TradingView


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 an up signal on Thu Jun 6 2024. On Fri Jun 7 2024 the up signal was confirmed. The MACD histogram gained strength.

  • 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 is falling and positive.

  • 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 has an up signal in place and is overbought.

  • 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 falling and positive.

  • 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 falling signaling that Monday will see some selling.

  • 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.

Stock Market Outlook: Support and Resistance Levels

5400 is resistance
5375 is resistance
5350 is resistance
5325 is resistance
5310 is resistance
5300 is resistance
5275 is resistance
5250 is light support
5225 is light support
5200 is good support
5190 is light support
5175 is light support
5150 is support
5125 is support
5115 is support
5100 is support


Stock Market Outlook for Mon Jun 10 2024 

For Monday the technical indicators and the SPX closing candlestick on Friday are signaling there will be some selling and dips. The dips could get deeper than expected.

The close is expected to be negative with lower volumes as investors will be waiting for Wednesday’s FOMC latest interest rate decision. Monday should close slightly lower.


Potential Economic and Political Market Moving Events

This is a big week for economic numbers.

Monday:

No reports

 






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