FullyInformed.com

Stock Market Outlook for Thu Jan 19 2023 – Bearish – Potential Bounce But Lower

Jan 19, 2023 | Stock Market Outlook

Bounce But Lower

On Wednesday a number of reports combined to send stocks lower as investors changed their outlook from worry about the Fed raising rates too high, to a recession that may not be as weak or short as many pundits predict. The retails sales numbers with and without autos was poorer than expected and showed December sales were not as strong as projected. Producer prices also fell lower than expected along with industrial production. The Fed’s Beige Book released at 2:00 PM offered no sign of respite for investors from rising rates as the Fed obviously continues to push for employment to slow and reverse course. A number of Fed officials also spoke on Wednesday and continued the hawkish tone. About the only bright spot was the Home Builders’ Index (NAHB) which showed an improvement which would seem to indicate that housing may have bottomed perhaps in October 2022.

The S&P lost 62 points to end the day at 3930 having closed below the interim 3975, 3965 and 3950 support levels. It closed above the 3925 support level. A bounce to retake 3950 is probable on Thursday but won’t hold.

The NASDAQ fared better falling 138 points to close at 10957, back below 11,000

Let’s review the closing technical indicators from the SPX on Wed Jan 18 to see what to expect for Thu Jan 19.


Stock Market Outlook Chart Comments At The Close on Wed Jan 18 2023 

On Wed Jan 18 the S&P fell back from the 200 day moving average which has been a continual problem for the index in this bear market and is a bearish signal. It closed above the 50, 100 and 21 day moving averages which is bullish.

The closing candlestick is bearish for Thursday but also signals that a bounce could happen, especially in the morning but will not hold.

The Upper Bollinger Band is starting to turn lower which is a concern but the Lower Bollinger Band is trending sideways which remains bullish.

The 200 and 100 day moving averages are falling which is bearish but the 21 day is turning back up and the 50 day moved above the 100 day on Friday Jan 13 for a new up signal. This up signal ended the down signal from Dec 30.

At present there are are 5 down signals in place since April 24 and one up signal.

The chart is 75% bearish for Thursday and shows the index is no longer overbought. This is a large jump in bearish signals since yesterday.

Stock Market Outlook review of Wed Jan 18 2023

Stock Market Outlook: Technical Indicators Review:

Momentum: Momentum is falling but still 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 lost strength on Wednesday. The histogram also lost strength.

  • 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 falling and nearing negative readings.

  • 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 stronger down signal in place. It is still signaling 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 falling sharply and turned negative.

  • 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 which often signals bigger moves in the index are coming, whether up or down does not matter. The signal is advising the index will make larger moves. The assumption is to the downside based on Wednesday’s sell-off.

  • 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:

4050 is resistance

4030 is resistance

4025 is resistance

4000 is resistance

3975 is resistance

3965 is resistance

3950 is resistance

3925 is light support

3900 is light 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

3685 is light support


 Stock Market Outlook for Tomorrow – Thu Jan 19 2023 

The technical signals are advising that the rally has run out of steam and momentum is leaving the bulls. A bounce is likely but has little chance of holding. The Rate Of Change technical indicator is rising which is probably signaling the index will see wider swings, likely to the downside. A move down to 3850 which is good support, is likely by next week.

The market still has a lot of bulls and the NASDAQ held up well on Wednesday but with investors nervous, the chance of a rebound that can hold and push above 4000 is unlikely. The market needs to move lower to bring in more buyers and try for another rally. To do that means falling below 3900, probably to 3850 by next week. A bounce on Thursday to 3950 is likely but will not hold.

Potential Economic and Political Market Moving Events

Events are Thursday are not expected to assist the bulls although housing has been a bit of a bright spot lately.

Thursday:

8:30 Weekly Initial Unemployment Insurance Claims are expected to come in at 215,000

8:30 Building permits are expected to be 1.35 million unchanged from November

8:30 Housing starts are expected to be 1.36 million down from 1.43 million in November

8:30 Philadelphia Fed manufacturing index is expected to be -10.0, up from -13.8 prior

3 Fed officials speak: Susan Collins, Lael Brainard and John Williams. All are expected to continuing the hawkish tone.


Stock Market Outlook Archives

Stock Market Outlook for Thu Mar 28 2024 – Choppy – Dips Likely – But Higher

Stock Market Outlook Choppy Dips Higher
Prior Trading Day Summary: On Wednesday investors returned and snapped up stocks that had drifted lower. The SPX bounced at the open and by the close it was up 45 ....... Read More

Morning Investing Strategy Notes for Wed Mar 27 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Wed Mar 27 2024 discuss the outlook for Wednesday and comments on a possible correction and what it might entail. There ....... Read More

Stock Market Outlook for Wed Mar 27 2024 – Unconfirmed MACD Down Signal

Stock Market Outlook Unconfirmed MACD Down Signal
Prior Trading Day Summary: I lost my power shortly after the markets closed. Articles this evening will be shorter if I can post any. On Tuesday trading volume picked up ....... Read More

Morning Investing Strategy Notes for Tue Mar 26 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Tue Mar 26 2024 discuss the outlook for Tuesday. As well there are comments on support levels to watch in the ....... Read More

Stock Market Outlook for Tue Mar 26 2024 – Still Bullish

Stock Market Outlook still bullish
Prior Trading Day Summary: On Monday low trading volumes hindered the chance of a positive close. The SPX saw just 3.4 billion shares traded. This matches the volume on last ....... Read More

Morning Investing Strategy Notes for Mon Mar 25 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Mon Mar 25 2024 discuss the outlook for Monday and the shortened week ahead of the Easter holiday. There are a ....... Read More

Stock Market Outlook for Mon Mar 25 2024 – Dip Likely But Higher Close

Stock Market Outlook - Higher
Prior Trading Day Summary: On Friday investors took profits ahead of the upcoming shortened Easter week with indexes sitting at all-time highs. On Friday the SPX closed down just 7 ....... Read More

Morning Investing Strategy Notes for Fri Mar 22 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Fri Mar 22 2024 discuss the outlook for Friday. There are a large number of trade ideas outlined including FedEx Stock ....... Read More

Stock Market Outlook for Fri Mar 22 2024 – Choppy – Dips Possible But Still Up

Stock Market Outlook Dip Likely But Still Up
Prior Trading Day Summary: On Thursday all 3 indexes closed at new all-time highs for a second straight day. Volumes remained decent but stocks are seeing some selling as investors ....... Read More

Morning Investing Strategy Notes for Thu Mar 21 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Thu Mar 21 2024 discuss the outlook for Thursday following Wednesday's FOMC interest rate decision and Fed Chair Powell's news conference. ....... Read More

Stock Market Outlook for Thu Mar 21 2024 – Higher Still

Stock Market Outlook Higher Still
Prior Trading Day Summary: On Wednesday the SPX, Dow Jones and NASDAQ indexes all closed at new all-time highs. Comments from Fed Chair Powell reaffirming 3 rate cuts in 2024 ....... Read More

Morning Investing Strategy Notes for Wed Mar 20 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Wed Mar 20 2024 discuss the outlook for Wednesday and the latest FOMC interest rate decision. There are also a number ....... Read More

Stock Market Outlook for Wed Mar 20 2024 – All About The Fed – Bullish

All About The Fed
Prior Trading Day Summary: On Tuesday the morning started with a dip down to 5131 but buyers were waiting for the dip and volumes picked up. Deep dips in a ....... Read More

Morning Investing Strategy Notes for Tue Mar 19 2024

Morning Investing Strategy Notes
For FullyInformed Members the morning Investing Strategy Notes for Tue Mar 19 2024 discuss the outlook for Tuesday following Monday's rally and before Wednesday's latest FOMC interest rate decision. There ....... Read More

Stock Market Outlook for Tue Mar 19 2024 – Choppy Dips Likely But Still Up

Stock Market Outlook choppy dips like but up
Prior Trading Day Summary: On Monday investors took advantage of the past two weeks of weakness to jump back into stocks. By the close the S&P was up 32 points ....... Read More

Search

Select to view all results...

Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors

Recent Outlooks

Stock Market Outlook for Thu Mar 28 2024 – Choppy – Dips Likely – But Higher

Prior Trading Day Summary: On Wednesday investors returned and snapped up stocks that had drifted lower. The SPX bounced at the open and by the close it was up 45 points to close at 5248. The NASDAQ rose 83 points …

Morning Investing Strategy Notes for Wed Mar 27 2024

For FullyInformed Members the morning Investing Strategy Notes for Wed Mar 27 2024 discuss the outlook for Wednesday and comments on a possible correction and what it might entail. There are a number of trade ideas outlined including FedEx Stock …

Stock Market Outlook for Wed Mar 27 2024 – Unconfirmed MACD Down Signal

Prior Trading Day Summary: I lost my power shortly after the markets closed. Articles this evening will be shorter if I can post any. On Tuesday trading volume picked up as stocks fell for another day. The SPX closed near …

Morning Investing Strategy Notes for Tue Mar 26 2024

For FullyInformed Members the morning Investing Strategy Notes for Tue Mar 26 2024 discuss the outlook for Tuesday. As well there are comments on support levels to watch in the SPX for the week. There are a number of trade …

Stock Market Outlook for Tue Mar 26 2024 – Still Bullish

Prior Trading Day Summary: On Monday low trading volumes hindered the chance of a positive close. The SPX saw just 3.4 billion shares traded. This matches the volume on last Friday. While poor , it is also bullish as it …

Morning Investing Strategy Notes for Mon Mar 25 2024

For FullyInformed Members the morning Investing Strategy Notes for Mon Mar 25 2024 discuss the outlook for Monday and the shortened week ahead of the Easter holiday. There are a number of trade ideas outlined including FedEx Stock (FDX), Nike …

Stock Market Outlook for Mon Mar 25 2024 – Dip Likely But Higher Close

Prior Trading Day Summary: On Friday investors took profits ahead of the upcoming shortened Easter week with indexes sitting at all-time highs. On Friday the SPX closed down just 7 points to 5234. For the week the index was up …

Morning Investing Strategy Notes for Fri Mar 22 2024

For FullyInformed Members the morning Investing Strategy Notes for Fri Mar 22 2024 discuss the outlook for Friday. There are a large number of trade ideas outlined including FedEx Stock (FDX), Nike Stock (NKE), Lululemon Athletica Stock (LULU),  and more …

Stock Market Outlook for Fri Mar 22 2024 – Choppy – Dips Possible But Still Up

Prior Trading Day Summary: On Thursday all 3 indexes closed at new all-time highs for a second straight day. Volumes remained decent but stocks are seeing some selling as investors are taking a few profits with the indexes at new …

Morning Investing Strategy Notes for Thu Mar 21 2024

For FullyInformed Members the morning Investing Strategy Notes for Thu Mar 21 2024 discuss the outlook for Thursday following Wednesday’s FOMC interest rate decision and Fed Chair Powell’s news conference. There are a large number of trade ideas outlined including …

Stock Market Outlook for Thu Mar 21 2024 – Higher Still

Prior Trading Day Summary: On Wednesday the SPX, Dow Jones and NASDAQ indexes all closed at new all-time highs. Comments from Fed Chair Powell reaffirming 3 rate cuts in 2024 were still “on the table” was all that investors needed …

Morning Investing Strategy Notes for Wed Mar 20 2024

For FullyInformed Members the morning Investing Strategy Notes for Wed Mar 20 2024 discuss the outlook for Wednesday and the latest FOMC interest rate decision. There are also a number of trade ideas outlined including Chewy Stock (CHWY), SPY ETF, …

Stock Market Outlook for Wed Mar 20 2024 – All About The Fed – Bullish

Prior Trading Day Summary: On Tuesday the morning started with a dip down to 5131 but buyers were waiting for the dip and volumes picked up. Deep dips in a number of big caps like NVIDIA Stock (NVDA) found ready …

Morning Investing Strategy Notes for Tue Mar 19 2024

For FullyInformed Members the morning Investing Strategy Notes for Tue Mar 19 2024 discuss the outlook for Tuesday following Monday’s rally and before Wednesday’s latest FOMC interest rate decision. There are also a number of trade ideas outlined including Chevron …