The stock market moved higher on Monday thanks to the price of oil climbing higher on the back of comments from Russia which were supportive of caps being put in place on oil production in an effort to boost the price of oil. Whether this will last or even work is doubtful based on the history of OPEC let alone Iran, Russia and Saudi Arabia which are notorious for not abiding by OPEC agreements. But for now oil moved higher and the market followed.
As well investors are optimistic ahead of the next quarterly earnings results which unofficially start on Tuesday before the market open, with Alcoa reporting their revenue and earnings.
S&P Index Close
The S&P index closed up 9.92 points to 2163.66.
Dow Jones Index Close
The Dow Jones closed up 88.55 points to 18,329.04.
NASDAQ Index Close
The NASDAQ closed up 36.27 points to 5,328.67.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook from Oct 10 2016
Stock Market Outlook: Chart Comments:
By the close of the day the S&P closed higher but still below the 50 day simple moving average (SMA) but above the 20 day simple moving average (SMA). The closing candlestick unfortunately is bearish for the following day but often this candlestick can be wrong in the market direction.
The 20 day moving average is still below the 50 day moving average but is moving sideways and no longer falling.
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 Bollinger Bands Squeeze is 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 positive 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 Monday.
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 positive and starting to climb. This is often an early signal of a general move higher for stock prices.
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 an up signal in place.
Stock Market Outlook for Tomorrow – Oct 11 2016
Alcoa reports their latest quarterly earnings before the market opens on Tuesday. That will have a major impact on the market move up or down depending on those earnings. However aside from Alcoa, the technical indicators are starting to shift with the Rate Of Change being perhaps the more interesting of the indicator. The rate of change is advising that higher prices will be seen shortly for stocks.
For Tuesday I would expect stocks to keep the sideways momentum but keep an up bias. A positive close is expected for Tuesday.
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