Before markets opened on Thursday Nov 21, the overseas markets were lower. It looked like it could be a rough day for equities but instead Thursday saw the index drift lower in the morning, reach a low around 10:30 and then wind their way back to close down just 4.92 points at 3103.54.
Stock Market Outlook Chart Comments At The Close on Thu Nov 21 2019
The SPX chart is still bullish, along with a few signs of weakness. The Upper Bollinger Band is starting to turn sideways as the market is no longer pressuring the Upper Bollinger Band higher. The candlestick at the close today is again bearish but often it also signals a bounce is coming.
All the remaining signals are still bullish.
3030 is still light support. All the major moving averages are still climbing including the 50 and 21 day moving averages. The 21 day moving average is still rising above the 3030 level which is bullish. The 50 day is above the 3000 level which is also bullish and is nearing the 3030 level.
As explained over the past two days, we should normally expect a dip or a couple of negative closes as the 50 day approaching this support level. This is common.
The Lower Bollinger Band has moved above the 100 day moving average and is ready to move above the 50 day moving average which is bullish.
The 100 and 200 day moving averages are still rising.
The two buy signals from September are still in place.
Overall the chart remains bullish and we could see the index try to bounce on Friday.
Stock Market Outlook review of Thu Nov 21 2019
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is positive and falling.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Tue Oct 15 2019. Today Nov 22 2019, MACD issued an unconfirmed down signal.
- 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 signal is falling and overbought.
- 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 is overbought and has a down 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 no longer overbought and falling.
- 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 which indicates lower prices should be expected.
- 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:
3100 is resistance
3030 is light support
3000 is support
2960 is light support
2950 was light support
2900 is light support
2860 is light support
2840 is support
2800 is strong support
2795 is light support
2745 to 2750 is light support
2725 is light support
2700 is light support
Stock Market Outlook for Tomorrow – Fri Nov 22 2019
The technical indicators are turning down and Thursday saw an unconfirmed down signal from MACD.
We will still see weakness on Friday but the low on Thursday was just to 3094 keeping intact the lower highs we have see this week. Friday looks set to see weakness in the morning, once again and then another rally attempt but a higher close is expected.
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