On Wednesday Fed Chair Powell announced a quarter point interest rate hike but in a rather subdued news conference seemed to indicate that while victory could not be declared, the economy was showing some signs of disinflation. The market rose on huge volume and pushed to the highest level since the fourth week of August. The S&P climbed 42 points ending the day at 4119. The NASDAQ rose 231 points to close at 11,816.
After hours Meta Stock (META) rose sharply on better than expected earnings. This will assist stocks on Thursday to move higher.
Let’s review the closing technical indicators from the SPX on Wed Feb 1 to see what to expect for Thu Feb 2.
Stock Market Outlook Chart Comments At The Close on Wed Feb 1 2023
On Wed Feb 1 the S&P traded higher and closed once again above the 200 day moving average.
The closing candlestick is bullish for Thursday.
The Upper Bollinger Band is rising which is bullish. The Lower Bollinger Band is also rising which is also bullish.
The 200 day moving average is rising which is bullish. All the major averages are now rising.
The 21 day moving average is preparing to advance to the 200 day shortly.
At present there are are 3 down signals in place since April 24 and 3 up signals.
The chart is 75% bullish for Thursday.
Stock Market Outlook review of Wed Feb 1 2023
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is rising and positive.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Monday Jan 9. The up signal gained strength on Wednesday as did the histogram.
- Settings: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9.
Ultimate Oscillator: The Ultimate Oscillator is unchanged and on the verge of signaling overbought.
- Settings: 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.
Slow Stochastic: The Slow Stochastic has a weak down signal in place and is overbought.
Settings: 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.
Relative Strength Index: The RSI signal is rising and signaling overbought.
- Settings: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It is often the first indicator to show an overbought or oversold signal.
Rate of Change: The rate of change signal is rising and positive.
- Settings: Rate Of Change is set for a 21 period. This indicator looks back 21 days and compares price action from the past to the present. With the Rate Of Change, prices are rising when signals are positive. Conversely, prices are falling when signals are negative. As an advance rises the Rate Of Change signal should also rise higher, otherwise the rally is suspect. A decline should see the Rate Of Change fall into negative signals. The more negative the signals the stronger the decline.
Support and Resistance Levels To Be Aware Of:
4125 is resistance
4100 is resistance
4090 is resistance
4075 is resistance
4050 is resistance
4030 is resistance
4025 is light support
4000 is light support
3975 is light support
3965 is light support
3950 is good support
3930 is light support
3900 is good support
3875 is light support
3850 is good support
3830 is good support
3810 is light support
3800 is good support
3775 is good support
3750 is good support
3730 is light support
3725 is light support
3715 is light support
3700 is good support
Stock Market Outlook for Tomorrow – Thu Feb 2 2023
Huge volume Wednesday afternoon pushed stocks to highs not seen since late August. On the S&P 5 billion shares traded while on the NASDAQ 6.7 billion shares traded. New highs on the S&P rose to 177 versus just 7 new lows. On the NASDAQ new highs were 198 versus 34 new lows. The market is positioned to continue its advance. The technical indicators are showing that many stocks are now overbought which means dips are likely but the outlook is bullish. This means dips are opportunities to setup more trades on Thursday and Friday.
Potential Economic and Political Market Moving Events
The next major event is on Friday when investors get the January non-farm payroll numbers.
Thursday:
8:30Weekly Initial Unemployment Insurance Claims are expected to rise to 195,000 from 188,000 last week
10:00 Factory orders are expect to come in at 2%, up from -1.6%
Friday:
8:30 January non-farm payroll numbers are expected to be 187,000
8:30 Unemployment rate is expected to come in at 3.6%
8:30 Average hourly earnings are expected to be 0.3% unchanged from last month.
Stock Market Outlook Archives
Stock Market Outlook For Wed May 6 2026 – Choppy But Higher Still
Morning Investing Strategy Notes for Tue May 5 2026
Stock Market Outlook For Tue May 5 2026 – Overbought and Lower
Morning Investing Strategy Notes for Mon May 4 2026
Stock Market Outlook For Mon May 4 2026 – Dips Likely With Possible Lower Close
Morning Investing Strategy Notes for Fri May 1 2026
Stock Market Outlook For Fri May 1 2026 – Overbought But Higher
Morning Investing Strategy Notes for Thu Apr 30 2026
Stock Market Outlook For Thu Apr 30 2026 – Dips Likely Possible Lower Close
Morning Investing Strategy Notes for Wed Apr 29 2026
Stock Market Outlook For Wed Apr 29 2026 – Choppy But Higher Ahead Of More Earnings
Morning Investing Strategy Notes for Tue Apr 28 2026
