Wednesday saw sellers sit at the 4200 level and continue to sell stocks as they rose, forcing the bulls to end another day with only minor changes. The S&P rose just 7 points to 4195, but it did reach 4202 intraday.
The weakness we are seeing is not changing the overall direction though as the bulls are still well incharge according to the closing technical indicators after the close of trading on Wednesday.
Stock Market Outlook Chart Comments At The Close on Wed May 26 2021
The Bollinger Bands are showing some signs of losing their bullishness. The Lower Bollinger Band is below the 50 day moving average which is a bullish signal. The Upper Bollinger Band though, is not rising but moving sideways which is bearish. The Upper Bollinger Band needs to move higher. The fact that it continues to move sideways signals there is weakness to the current advance.
The S&P stayed above the 21 day moving average and ended above it. This left behind a bullish candlestick for Thursday.
The 21 day moving average stopped declining on Monday and the 50, 100 and 200 day moving averages are still climbing.
The chart is still mixed but the close above the 21 day moving average for a third day is bullish.
Stock Market Outlook review of Wed May 26 2021
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 a down signal on Friday April 30 2021. On Wednesday the down signal is almost gone by the close.
- 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.
- 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 an up signal in place for Thursday.
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.
- 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 unchanged which indicates investors should not expect much change in prices.
- 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 May 27 2021
For Thursday there is not a lot of change except for MACD almost ready to issue a new up signal. There is still bearishness hanging around but while the technical indicators are somewhat mixed, there is a bias to the bullish side. Thursday will again see dips but another higher close is expected.
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
