Friday’s unemployment report came in a bit weaker than expected but still showed continued growth. Unemployment though moved up slightly to 5% as more people entered the labor force seeking employment.
Investors at first thought the numbers were strong enough that the Fed might raise rates earlier than December. The S&P dipped and by midday it was trading below the 2150 level.
However a number of analysts released comments that contradicted those who believed rates would rise early and that seemed to stabilize the market which recovered back above 2150 to close at 2153.74. With investors now waiting for the quarter earnings to begin to be released, Monday may be a sideways day.
S&P Index Close
The S&P index closed down 7.03 points to 2,153.74.
Dow Jones Index Close
The Dow Jones closed down 28.01 points to 18,240.49.
NASDAQ Index Close
The NASDAQ closed down14.45 points to 5,292.40.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook for Oct 7 2016
Stock Market Outlook: Chart Comments:
By the close of the day losses were mild and the S&P managed to hold above 2150. The closing candlestick was again bearish for stocks for Monday especially with the index stuck between the 50 day moving average and the 20 day moving average.
The 20 day moving average continues to fall away from the 50 day moving average which is bearish.
The 100 and 200 day moving averages are still climbing and the Lower Bollinger Band that was moving lower is starting to turn back up. However a possible Bollinger Bands Squeeze may be starting to form. This needs to be watched.
Stock Market Outlook: Support and Resistance Levels:
These are the present support and resistance levels.
The market was trying to build some support at the 2180 level. At present this is now resistance.
2160 is very light support.
2150 is support.
2125 is light support.
2100 is light support.
2090 is very light support.
2075 is also light support
Below that is 2050 which is light support.
2025 is better support than 2050 through to 2090.
2000 is primary support.
Weak support is at 1970 while stronger support is at 1956 and technically it is more important than 1970 for the market. 1940 is light support as is 1920. 1900 is more symbolic than anything else.
Stock Market Outlook Technical Signals
Momentum: For momentum I use a 10 period when studying market direction. Momentum is back negative but actually moving sideways for the past several days.
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 buy signal on Thursday Sep 22. That buy signal was very weak again on Friday.
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 is positive but moving more sideways than up or down.
Rate of Change: Rate Of Change is set for a 21 period. The rate of change signal is negative and moving 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 has a down signal in place.
Fast Stochastic: For the Fast Stochastic I use the K period of 20 and D period of 5. These are not default settings but settings I set for the 1 to 3 month S&P 500 chart when I have it set for daily views. The Fast Stochastic has a down signal in place.
Stock Market Outlook for Tomorrow – Oct 10 2016
On Tuesday Alcoa releases their latest quarterly revenue and earnings numbers before the markets open. Later in the week we get some big financial stocks releasing their numbers. For Monday I would expect the market to try to move slightly higher ahead of the earnings unofficially starting on Tuesday.
By the close on Tuesday the market looks set to be just slightly higher as investors prepare for the next earnings season to start.
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