The outlook forFriday was for stocks to ip in the morning but then climb back in the afternoon. Instead the triple witching day had high volume and the market stayed in a tight range between 2130 and 2140 for most of the day resulting in another slight loss pn Friday. The morning dip was not as deep as the prior 5 days of trading when the market dipped deeper.
S&P Index Close
The S&P index closed down 8.10 points to close at 2139.16.
Dow Jones Index Close
The Dow Jones closed down half a percent with a loss of 88.68 to 18,123.80.
NASDAQ Index Close
The NASDAQ had the best day of the three indexes again and continues to lead the markets. It was a drop of 5.12 to close at 5,244.57.
Stock Market Outlook – Technical Indicators At The Close
Stock Market Outlook – Sep 16 2016
Stock Market Outlook: Chart Comments:
The SPX stayed well above the 2125 support level on Friday but below the 2150 level. It did however close pretty well at the 2140 level but the indecisiveness of trading on Friday left the market with a bearish candlestick at the end of trading. Just how significant this may be is difficult to determine as a lot of the action on Friday was due to the triple witching day and investor nervousness ahead of the Fed’s interest rate decision on Wednesday.
The 20 day simple moving average (SMA) is below the 50 day which issues a short-term sell signal.
All the major moving averages are continuing to climb..
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 was very light support.
2150 was 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 negative and moving sideways.
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 sell signal on August 1. That sell signal was weaker 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 and rising.
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 an up 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 to neutral signal for Monday.
Stock Market Outlook for Tomorrow – Sep 19 2016
For Monday the market has a mixed technical outlook. Two are positive and rising. One is neutral and three are negative but not falling lower. The signals point to a sideways market that may have a slight bias up heading into Monday.
Don’t be surprised if there is some weakness on Monday but heading into the Fed’s interest rate decision on Wednesday, the market may try to move higher as investors anticipate there will be no interest rate rise.
Monday therefore has a sideways outlook with a slight bias up as the market may try to retake 2150. If the market moves higher than anticipated on Monday watch for Tuesday to turn sideways again.
Caution is still warranted heading into the Fed’s interest rate announcement.
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