Stock Market Outlook for Mon Jun 14 2021 – Bias Higher

Stock Market Outlook Bias Is Up

Friday saw new highs again in the S&P and a third week of gains for the S&P.

Over the past three weeks the S&P has added 2.2% of gains ending the second week of June at 4247.

Let’s review Friday June 11 close to see what to expect to start off the third week of June.


Stock Market Outlook Chart Comments At The Close on Fri Jun 11 2021 

The SPX ended the day higher and left behind a bullish candlestick for Monday.

Two events though are of importance. The Upper Bollinger Band is not rising and the Lower Bollinger Band is turning back up which is bearish.

The other concern remains the 21 day and 50 day moving averages. If the 50 day crosses above the 21 day, it will be a strong bearish signal. We should get clarity this week on this signal.

Meanwhile the 50, 100 and 200 day moving averages are climbing. These are bullish signals.

Overall the SPX chart is still more bullish than bearish but the change in the Bollinger Bands is significant and needs to be watched.

Stock Market Outlook review of Fri Jun 11 2021

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 Friday May 28 2021. On Friday the up signal was stronger.

  • 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 which is bearish.

  • 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 a neutral signal in place for tomorrow 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 rising.

  • 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 rising sharply which usually indicates a prices are going to make a bigger move, up or down.

  • 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:

4250 is resistance

4225 is resistance

4200 is resistance

4150 is light support

4100 is light support

4070 is very light support

4050 is light support and where the 50 day is currently residing. This would represent a 4.4% decline.

4000 is good support

3900 is support and just below the 100 day moving average.

3850 is support

3800 is support

3750 is good support

3700 is light support and just below the 200 day moving average.

3680 is light support

3600 is strong support


 Stock Market Outlook for Tomorrow – Mon Jun 14 2021 

For Monday the technical indicators and still signaling another up day for Monday but the change in the Bollinger Bands is significant.

On top of this is the neutral Slow Stochastic signal from overbought and the rapid rise in the rate of change which often signals a bigger move is coming, either up or down. All of these signals need to be watched as we start the week off.

Monday looks set to be a bit choppy but with a bias still higher to start off the third week of June.


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