Prior Trading Day Summary:
On Wednesday the CPI number was higher than estimates. For many analysts it meant that the Fed would probably delay any rate cut longer than expected. Most analysts had picked June as the first rate cut. Now many were talking about September and others about no rate cuts in 2024 at all. That saw stocks spend the day lower. By the close the S&P was down 49 points to $5160 while the NASDAQ fell 136 points to close at 16170.
Let’s review the closing technical indicators on Wed Apr 10 2024 to see what to expect for Thu Apr 11 2024.
Stock Market Outlook: SPX Closing Chart For Wed Apr 10 2024
The index closed well below the Upper Bollinger Band and below the 21 day moving average. This is bearish to neutral for a second day.
The closing candlestick came close to reaching the Lower Bollinger Band. While bearish, the candlestick is also typical of a bounce attempt for Thusday.
The 21 day moving average is now turning sideways which is bearish.
The 50 day moving average is rising and at 5100, which is bullish.
The 100 and 200 day moving averages are climbing which is bullish. The 200 day is at 4708 on the SPX which is bullish.
The Bollinger Bands are in another Bollinger Bands Squeeze. The Lower Bollinger Band is turning back up while the Upper Bollinger Band is turning lower. A new Bollinger Bands Squeeze is underway and at present the squeeze looks like it will end with stocks moving lower.
The S&P chart is more bearish than bullish for Thursday.
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is falling and negative.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Tue Apr 2. On Wed Apr 10 2024 the down signal was stronger. The MACD histogram is also strongly negative.
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Ultimate Oscillator: The Ultimate Oscillator is falling.
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Slow Stochastic: The Slow Stochastic has an down signal in place
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Relative Strength Index: The RSI signal is falling and negative. It is nearing oversold readings.
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Rate of Change: The rate of change signal is falling indicating Thursday will end lower. It is nearing oversold levels.
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Stock Market Outlook: Support and Resistance Levels |
5275 is resistance |
5250 is resistance |
5225 is resistance |
5200 is resistance |
5190 is resistance |
5175 is resistance |
5150 is resistance |
5125 is support |
5115 is support |
5100 is support |
5075 is support |
5050 is support |
5025 is support |
5000 is light support |
4990 is light support |
4975 is light support |
4950 is support |
Stock Market Outlook for Thu Apr 11 2024
The technical indicators are all pointing to a lower day on Thursday. While there is a good chance for a bounce attempt, the technical indicators are advising that any bounce won’t hold on Thursday.
A lower day is expected.
On Thursday before the open investors get the latest Producer Price Index readings. After Wednesday’s CPI being higher than expected, many investors now believe the PPI will also be higher. This will add to selling pressure on Thursday, if the rates are higher than estimated.
Potential Economic and Political Market Moving Events
The major events this week were on Tuesday with the latest PMI numbers being released and the Fed’s Beige Book due out Wednesday at 2:00 PM and PPI on Thursday.
Monday:
No economic reports
Tuesday:
6:00 NFIB optimism index is expected to rise slightly to 89.7 Instead it rose to 88.5%.
Wednesday:
8:30 Consumer price index wasexpected to be lower at 0.3% versus 0.4% prior. Instead it rose to 0.4%.
8:30 Core CPI was estimated to be 0.3% but rose to 0.4%.
8:30 CPI year-over-year was expected to be 3.4%, but rose to 3.5%
8:30 Core CPI year-over-year was estimated to be 3.7% but came in at 3.8%
10:00 Wholesale inventories came in as expected at 0.5%
2:00 Minutes of the March FOMC meeting
2:00 Monthly Federal USA budget is estimated at -$220 billion versus the prior -373 billion.
Thursday:
8:30 Weekly Initial Unemployment Insurance Claims are estimated to be 217,000
8:30 Producer Price Index is estimated to fall to 0.3%
8:30 Core PPI is estimated to fall to 0.2%
8:30 PPI year-over-year is estimated at 1.6%
8:30 Core PPI tear over year is estimated at 2.8%