Prior Trading Day Summary
On Wednesday the Fed news conference sunk the market as Fed Chair Powell made it clear in his press conference at 2:30, the chance of a further rate hike was very high heading into the fall. Investors were also surprised by comments suggesting it could be late 2024 before the market sees any interest rate decrease. A lot of investors did not like what they heard and they voted by selling out of positions and taking profits out of the markets.
The losses by the close were not minor on either index.
The SPX fell 41 points on low volume of 3.3 billion shares. It closed at 4402.
The NASDAQ lost 209 points by the close. The index closed at 13,469 on 4.9 billion shares traded.
Let’s review the closing technical indicators from Wed Sep 20 2023 to see what to expect for Thu Sep 21 2023.
Stock Market Outlook: SPX Closing Chart For Wed Sep 20 2023
The index closed below the 50 and 21 day moving averages which is bearish. The closing candlestick is bearish but also signals a bounce is likely if not Wednesday then by Thursday.
The 50, 100 and 200 day moving averages are continuing to climb which is bullish. The 21 day moving average is turning lower is bearish.
The Lower Bollinger Band is back rising which is bearish. It moved above the 100 period moving average a few trading days ago.
The Upper Bollinger Band is moving lower which is bearish. The Bollinger Bands Squeeze on Wednesday continues to suggest stocks will move lower out of this squeeze.
Stock Market Outlook: Technical Indicators Review
|Momentum: Momentum is falling and negative.|
|MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Mon Sep 18. On Wednesday the down signal is much stronger.|
|Ultimate Oscillator: The Ultimate Oscillator is falling and negative.|
|Slow Stochastic: The Slow Stochastic has a down signal in place and is entering oversold readings.|
|Relative Strength Index: The RSI signal is falling and negative.|
|Rate of Change: The rate of change signal is falling and ready to turn negative.|
Stock Market Outlook: Support and Resistance Levels
|4600 is resistance|
|4575 is resistance|
|4550 is resistance|
|4525 is resistance|
|4500 is resistance|
|4485 is resistance|
|4470 is resistance|
|4450 is support|
|4435 is support|
|4420 is support|
|4400 is support|
|4390 is support|
|4370 is support|
|4350 is support|
Stock Market Outlook for Thu Sep 21 2023
The Fed news conference have been dominated by selling late in the afternoon. Today we saw the same occurrence. The selling turned a lot of the technical indicators bearish. For Thursday watch for a potential bounce but be aware that this is an oversold bounce and unless it can retake 4450 and close above it, the index looks set to challenge 4400 for support. Friday will end lower despite being very oversold.
Potential Economic and Political Market Moving Events
This week the Fed’s interest rate decision and news conference on Wednesday were the main events to be watching.
8:30 Weekly Initial Unemployment Insurance Claims
8:30 Philadelphia Fed manufacturing survey which is expected to have declined.
10:00 US Leading economic indicators
10:00 Existing home sales are estimated to have risen 300,000 to to 4.1 million.