History repeated itself for the first day of Oct as the day ended negative, chalking up another first day of Oct that ended lower. This now marks the 7 year out of 11 that the markets closed lower to start October trading.
The market was under selling pressure early in the day but as oil rose to above $50 for Brent crude the market stabilized and closed well off the day’s lows.
S&P Index Close
The S&P index closed down 7.07 points to 2,161.20.
Dow Jones Index Close
The Dow Jones closed down 54.30 points to 18,253.85.
NASDAQ Index Close
The NASDAQ closed down 11.13 points to 5,300.87.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook – Oct 3 2016
Stock Market Outlook: Chart Comments:
The S&P broke below the 2160 level but managed to close just above it after a dip down to 2154.77 in the morning.
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 but the Lower Bollinger Band is heading toward the 200 day moving average. If it crosses below, it will be a major sell signal.
The closing candlestick is bearish to neutral at the close of trading today.
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 rising but more sideways than up or down.
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 remained weak 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 also 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 aa 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 aa down to neutral signal in place.
Stock Market Outlook for Tomorrow – Oct 4 2016
With the market moving lower on Monday, the technical indicators are divided. The two stochastic indicators are both signaling down. Momentum, Ultimate Oscillator and MACD are basically stuck sideways just like the market and the Rate Of Change is slightly negative and moving sideways. Just about everything points to the market not really going anywhere.
The closing candlestick on Monday was bearish and the technical indicators are short-term bearish as well. Tuesday should see an attempt to move higher following Monday’s loss, but not much of a move up is expected. Instead a close slightly lower looks to be more probable for Tuesday as predicted by the technical indicators.
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