Stock Market Summary for Fri Jun 1 2018
Investors flocked back to stocks in a big way on Friday ending the roller coaster week for stocks on a positive note. The non-farm payroll number was stronger than expected and that changed analysts outlook on the weak first quarter GDP numbers. They now believe those numbers were an anomaly and that May’s employment numbers show strength in the GDP for the next quarter.
The tech sector index rallied to all new highs on Friday which pulled much of the rest of the market higher. Friday saw a strong close which may sent Monday morning up for a dip to start the day. Let’s take a look at the numbers from Friday to see what we should expect for Monday June 4.
Closing Statistics from Fri Jun 1 2018
The S&P rose 29.35 closing at 2734.62
The NASDAQ Composite rose 112.21 for a 1.51% gain to close at 7554.33. The index is within 83 points of a new all-time high.
The Dow Jones Industrial Average rose 219.37 to 24,635.21.
Stock Market Outlook Chart Comments At The Close on Fri Jun 1 2018
The S&P closed above the 21 day and all major moving averages. The closing candlestick is strongly bullish for Monday.
The 50 day moving average is still trending below the 100 day but is no longer falling. The 200 day is rising.
The Bollinger Bands are beginning to show signs of a possible squeeze coming but it is too early to tell if the squeeze will actually form up.
Overall the index chart is strongly bullish to push higher and probably retake 2750 as early as Monday or Tuesday.
Stock Market Outlook review of Wed May 30 2018
Stock Market Outlook: Technical Indicators Review:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive and rising.
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 an up signal on May 7. On Tue May 29 2018 MACD issued an unconfirmed down signal which was not confirmed all of last week. On Friday it still showed a down signal but it is a weak signal and does not confirm a down signal.
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 signal is positive and rising although in general it is more sideways than actually up or down.
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 has a strong up signal in place for Monday.
Relative Strength Index: 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. The RSI signal is rising.
Rate of Change: 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. The rate of change signal is rising.
Support Levels To Be Aware Of:
2745 to 2750 was light support
2725 is light support.
2700 is support.
2675 is light support.
2650 is light support
2620 is light support
2600 is strong support.
There is good support at the 2550 level from where the market bounced back from the recent correction low on Feb 9.
The S&P has light support at 2480. It also has light support at 2450 and good support at 2425. Below that there is some support at 2400, 2380, 2350. 2300 has the most support at present but would represent a full correction as a drop to this level would be 20% and just 5% away from a potential bear market signal.
Stock Market Outlook for Tomorrow – Mon Jun 4 2018
The roller coaster final week of May looks like it may have set the market up for a better week to start off June.
Monday looks like the market will be lower or dip in the early morning due to the heavier buying late afternoon on Friday. However any dip, should it happen will be an opportunity for more trades to be setup.
Monday looks set to end the day higher.
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