Wednesday’s market action was all about the Fed. The day started with the S&P index slipping slightly but managing to stay above 4350. The noon hour however saw sellers push through and move the index to 4230 to 4235 before 2:00 PM. The Fed’s announcement on interest rates send the index tumbling to 4202 before bouncing back by 3:30 to almost reach 4240. The last 20 minutes saw sellers return again and send the index back to a close of 4223 for a drop of just over half a percent for a loss of 22 points.
Stock Market Outlook Chart Comments At The Close on Wed Jun 16 2021
The SPX after the Fed’s announcement fell to the 21 day moving average before bouncing back above it.
The dip however left a bearish closing candlestick for Thursday, and as you will read below in the technical indicators, a switch for many of them to a bearish outlook.
Two events remain important. The Upper Bollinger Band is not rising and the Lower Bollinger Band is turning back up, both of which is bearish.
The other is the 21 day is finally moving higher, away from the 50 day which is a bullish sign.
Meanwhile the 50, 100 and 200 day moving averages are climbing. These are bullish signals.
Overall the SPX chart is still more bullish than bearish but the the Bollinger Bands is significant and needs to be watched.
One other technical indicator to mention is the number of doji candlesticks that are short tops with a long shadow since April as the index has pushed above the 4200 level. Normally this many “doji” candlesticks over such a long period of time can be bearish. Also note how long the Bollinger Bands have stayed close to each other since the middle of May. Again this is bearish. While perhaps not a major concern at this point, both of these signals need to be watched for any further signals that advise the index will dip lower before trying for another rally.
Stock Market Outlook review of Wed Jun 16 2021
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is falling 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 Friday May 28 2021. On Wednesday the up signal was almost gone.
- 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 trending unchanged.
- 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 down signal in place for tomorrow and is very 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 for a second day.
- 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 falling as well which normally indicates investors should not expect a big change in prices, up or down.
- 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:
4250 is resistance
4225 is resistance
4200 is resistance
4150 is light support
4100 is light support
4070 is very light support
4050 is light support and where the 50 day is currently residing. This would represent a 4.4% decline.
4000 is good support
3900 is support and just below the 100 day moving average.
3850 is support
3800 is support
3750 is good support
3700 is light support and just below the 200 day moving average.
3680 is light support
3600 is strong support
Stock Market Outlook for Tomorrow – Thu Jun 17 2021
Thursday could see a bounce attempt but the technical indicators are not pointing to a resumption of the rally at this time. Instead they are flashing weakness signals. For Thursday investors should prepare to see some further selling and a move below 4200 is likely. This will not break the bull rally at this point but weakness now is advising we will see some choppier days ahead and some negative closes.
For the SPX, Thursday would appear to be one of them with a rather volatile day coming up and a lower close.
Stock Market Outlook Archives
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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
