Stock Market Outlook for Thu Oct 4 2018 – Choppy With Bias Lower

Wednesday saw new all-time highs in the Dow and the S&P came within a point of its all-time high but rising bond yields in the 2, 3 and 5 year periods to their highest level in 10 years spooked investors. They sold the rally back down for yet another day.

Despite this intraday give-back, the day was impressive with all 3 indexes managing to close positive, albeit on what is a narrow base of support for the rally.

Stock Market Outlook Chart Comments At The Close on Wed Oct 3 2018 

The S&P once more came close to the 21 day moving average and then pulled back. This left another bearish candlestick. However the index still closed above the 21 day moving average.

All the other major moving averages are still  climbing.

The Lower Bollinger Band is still below the 50 day moving average and the Upper Bollinger Band is turning higher which often signals an end to the Bollinger Bands Squeeze. The S&P chart is more bullish than bearish.

Stock Market Outlook review of Wed Oct 3 2018

Stock Market Outlook: Technical Indicators Review:

Momentum: Momentum is still positive and moving sideways.

• Settings: For momentum I use a 10 period when studying market direction.

MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Wednesday Sep 26. The down signal is still active for Thursday but it is weaker.

• 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 signal is negative and rising.

• 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 still 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 moving sideways.

• 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.

• 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 Levels To Be Aware Of:

2860 is light support

2830 is light support

2795 is light support

2745 to 2750 is light support

2725 is light support.

2700 is support.

2675 is light support.

2650 is light support

2620 is light support

2600 is strong support.

There is good support at the 2550 level from where the market bounced back from the recent correction low on Feb 9.

The S&P has light support at 2480. It also has light support at 2450 and good support at 2425. Below that there is some support at 2400, 2380, 2350. 2300 has the most support at present but would represent a full correction as a drop to this level would be 20% and just 5% away from a potential bear market signal.

 Stock Market Outlook for Tomorrow – Thu Oct 4 2018 

Thursday should see some additional weakness following the give back of yet another intraday rally.

The S&P though is still holding above the 21 day and 50 day moving averages and is above 2900. The technical indicators are somewhat split between those pointing down such as MACD and those pointing back to up.

Overall the weakness we saw develop intraday on Wednesday is probably a sign that the market needs a bit more time to consolidate recent gains. Thursday looks weak, especially in the early morning trading. For Thursday the S&P is holding a slight bias lower.

Stock Market Outlook Archives

Stock Market Outlook for Tue May 7 2024 – MACD Up Signal Confirmed

Prior Trading Day Summary: On Monday stocks continued their advance. The only dip of any size was just before 12:30 when the SPX fell almost to 5150 which brought in ....... Read More

Morning Investing Strategy Notes for Mon May 6 2024

For FullyInformed Members the morning Investing Strategy Notes for Mon May 6 2024 discuss the outlook for the second week of May following Friday's April non-farm payroll numbers. There are ....... Read More

Stock Market Outlook for Mon May 6 2024 – Unconfirmed MACD Up Signal

Prior Trading Day Summary: On Friday the jobs report came in weaker than expected. With investors believing this could bring some relief to interest rates for the Fed, investors poured ....... Read More

Morning Investing Strategy Notes for Fri May 3 2024

For FullyInformed Members the morning Investing Strategy Notes for Fri May 3 2024 discuss the expectations for April's unemployment report. There are a large number of trades outlined for today. ....... Read More

Stock Market Outlook for Fri May 3 2024 – All About The April Non-Farm Payroll Report

Prior Trading Day Summary: On Thursday investors pushed stocks higher for the second time this week, ahead of Friday's April jobs report. The S&P gained gained 45 points to close ....... Read More

Morning Investing Strategy Notes for Thu May 2 2024

For FullyInformed Members the morning Investing Strategy Notes for Thu May 2 2024 discuss the FOMC interest rate decision and Fed's news conference. There are a large number of trades ....... Read More

Stock Market Outlook for Thu May 2 2024 – Potential Bounce But Lower

Prior Trading Day Summary: On Wednesday investors moved stocks higher during the Fed's news conference but then sold those same stocks lower in the final half hour in a wild ....... Read More

Morning Investing Strategy Notes for Wed May 1 2024

For FullyInformed Members the morning Investing Strategy Notes for Wed May 1 2024 discuss the outlook for the start of May. There are a large number of trades outlined for ....... Read More

Stock Market Outlook for Wed May 1 2024 – Bounce But Lower – Fed Interest Rate Decision

Prior Trading Day Summary: Tuesday saw stocks tumble as investors decided to take profits from the recent rally. Economic reports on Tuesday did not favor the Fed cutting interest rates ....... Read More

Morning Investing Strategy Notes for Tue Apr 30 2024

For FullyInformed Members the morning Investing Strategy Notes for Tue Apr 30 2024 discuss the outlook for the final trading day of the month and the start of May. There ....... Read More

Stock Market Outlook for Tue Apr 30 2024 – Dips Likely – Flat To Higher Close

Prior Trading Day Summary: Monday saw the index trade choppily in a sideways trend until the final hour when the SPX dipped down below 5100 but then found buyers and ....... Read More

Morning Investing Strategy Notes for Mon Apr 29 2024

For FullyInformed Members the morning Investing Strategy Notes for Mon Apr 29 2024 discuss the outlook for the final week of April. There are a large number of trades outlined ....... Read More

Stock Market Outlook for Mon Apr 29 2024 – Some Weakness But Higher

Prior Trading Day Summary: Friday saw investors continue the rally despite the PCE number showing far more weakness than expected. The rally on Friday though saw lower volumes which could ....... Read More

Morning Investing Strategy Notes for Fri Apr 26 2024

For FullyInformed Members the morning Investing Strategy Notes for Fri Apr 26 2024 discuss the outlook following the surprisingly low GDP and strong earnings from Microsoft, Alphabet and others on ....... Read More

Stock Market Outlook for Fri Apr 26 2024 – Higher and Positive Close

Prior Trading Day Summary: Thursday's GDP number came in much lower than expected at 1.6%. This stunned analysts and investors and the market plunged at the start of the day. ....... Read More