Friday saw Thursday’s late afternoon rebound, hold steady. With only a small amount of weakness in the morning, stocks moved higher over the lunch hour. Then mid-afternoon they moved up slightly again and held into the close. For the day, the S&P was reasonably solid, especially considering the selling on Thursday morning.
S&P 500 Index Close
The S&P index ended down 2.32 to 2582.30
Dow Jones Index Close
The Dow Jones ended down 39.73 to 23,422.21
NASDAQ Index Close
The NASDAQ closed flat, up 0.89 to 6,750.94
Stock Market Outlook
Chart Comments At The Close:
On Friday Nov 10 the S&P fell to the 21 day moving average but not as low as we saw on Thursday. Stocks held steady after a bit of weakness in the morning. They closed almost flat on the day but left a bearish candlestick for Monday.
The Bollinger Bands Squeeze is continuing. All major moving averages are still rising.
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is neutral, falling lower on Friday.
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 a sell signal on Oct 24. The sell signal gained strength on Friday after almost turning into a buy signal late in the week.
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 sideways.
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 for Monday is negative and overbought.
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 often is the first indicator to show an overbought or oversold signal. The RSI signal fell dramatically on Friday and continues to point lower.
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. The rate of change signal is positive and moving sideways.
Support Levels To Be Aware Of:
There is support at the 2550 level which could assist in pushing the index higher in November.
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.
Stock Market Outlook for Tomorrow – Mon Nov 13 2017
For Monday Nov 13, the S&P has two sell signals in place (MACD and Slow Stochastic) and 1 neutral signal for momentum. All the other signals are either sideways or pointing lower.
While the technical indicators clearly show weakness, the S&P continues to hold about the 21 day moving average. If it closes below the 21 day moving average on Monday, we should expect further downside action which will probably test support at the 2550 level. I am not anticipating that to happen. With the index holding above the 21 day moving average, there is a better chance Monday will be higher.
For Monday then the outlook is for weakness to continue but for the S&P to hold a bias to the upside.
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