Despite bond markets being closed on Friday trading volume was above average as more investors placed capital back into stocks.
The day ended with the all 3 indexes modestly higher.
The S&P jumped 36 points to end the day at 3992 but did move above 4000 twice during the later afternoon. The index has added 306 points between Thursday and Friday.
The NASDAQ climbed 209 points closing the day at 11,323. For the past two days the index added 969 points.
Technically there were a number of interesting changes to report.
Let’s review the closing SPX technical indicators from Friday to see what to expect for Mon Nov 14 2022, the start of the third week of November and the week after the Mid-Term Elections.
Stock Market Outlook Chart Comments At The Close on Fri Nov 11 2022
On Friday the S&P closing candlestick was above all moving averages and just below the 200 day. The index closed once again above the Upper Bollinger Band which is bullish. The closing candlestick advises a lower open or selling in the morning is likely as the candle signals overbought. However the close still looks positive.
The Upper Bollinger Band has turned back up and is above all the major moving averages except the 200 day. This is bullish.
The Lower Bollinger Band turned sideways which gives a neutral signal to start the third week.
A new up signal was generated on Friday by the close as the 21 day moving average is back above the 50 day. This is bullish and if it moves higher on Monday it will negate the Sep 16 down signal when the 21 day fell below the 50 day.
The 50, 100 and 200 day moving averages are still falling. This is bearish.
There are 7 down signals in place since April and one new up signal.
The chart rose to 75% bullish for Monday thanks to the new up signal.
Stock Market Outlook review of Fri Nov 11 2022
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is falling but still 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 Thursday Oct 16. On Friday the up signal gained more strength. The histogram also 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 turned sideways to start the week.
- 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.
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 and into overbought signals.
- 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 but still positive.
- 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:
4100 is resistance
4090 is resistance
4070 is resistance
4050 is resistance
4030 is resistance
4025 is resistance
4000 is resistance
3975 is resistance
3965 is resistance
3950 is resistance
3925 is light support
3900 is light support
3875 is light support
3850 is light support
3825 is light support
3800 is good support
Stock Market Outlook for Tomorrow – Mon Nov 14 2022
A new up signal on Friday is also a sign of the market being overbought after two strong days of gains. There is though room to the upside.
For Monday November 14 the morning will see some selling and it could be as deep as 3950 but the close should be above 4000. The 1 year and 5 year inflation expectations reports are released at 11:00 AM and could impact the markets. See comments below.
Potential Economic and Political Market Moving Events
On Monday investors get the inflation expectations from the NY Fed. Only the 1 year is of importance for stocks. A number above 5.7% will be negative for the index.
Monday:
11:00 NY Fed 1 year inflation expectations is expected to come in below 5.7%
11:00 NY Fed 5 year inflation expectations is expected to come in at 2.2%
Stock Market Outlook Archives
Stock Market Outlook for Fri Apr 19 2024 – Deeply Oversold – Bounce Likely – Higher Close
Morning Investing Strategy Notes for Thu Apr 18 2024
Stock Market Outlook for Thu Apr 18 2024 – Deeply Oversold – Bounce Attempt Expected
Morning Investing Strategy Notes for Wed Apr 17 2024
Stock Market Outlook for Wed Apr 17 2024 – Another Bounce Attempt
Morning Investing Strategy Notes for Tue Apr 16 2024
Stock Market Outlook for Tue Apr 16 2024 – Deeply Oversold
Morning Investing Strategy Notes for Mon Apr 15 2024
Stock Market Outlook for Mon Apr 15 2024 – Expect A Bounce
Morning Investing Strategy Notes for Fri Apr 12 2024
Stock Market Outlook for Fri Apr 12 2024 – All About Bank Earnings
Morning Investing Strategy Notes for Thu Apr 11 2024
Stock Market Outlook for Thu Apr 11 2024 – Weakness and Lower
Morning Investing Strategy Notes for Wed Apr 10 2024
Stock Market Outlook for Wed Apr 10 2024 – All About The CPI Numbers
