Prior Trading Day Summary:
On Wednesday stocks opened higher, set a new 52 week high of 5741 and then ran into selling.
The dip was not as deep as anticipated but still saw the SPX fall to 5712 before closing at 5722. It was a choppy day but the 5700 valuation on the SPX was not tested as it was on Tuesday. This is good news for the bulls as they wait for the market to make another move higher.
The SPX traded just 3.7 billion shares to close down 10 points at 5722.
The NASDAQ traded 5.0 billion shares a decrease of 500 million shares, to close up 7 points to 18,082.
After hours Micron Technology Stocks (MU rose over 11% after reporting better than estimated earnings and revenue. As well margins were higher which is always a good sign. This should help the morning open but overall we may not see big moves until we get the non-farm payroll for September, next Friday and then into the next round of earnings in October.
Let’s review the closing technical indicators from Wed Sep 25 2024 to see what to expect on Thu Sep 26 2024.
Stock Market Outlook: SPX Closing Chart For Wed Sep 25 2024
The index closed above the 21 day moving average and at the Upper Bollinger Band which is bullish.
The closing candlestick has two shadows (head and tail) which are short indicating an overbought market and a chance for a dip.
The 21 day moving average is higher at 5601. This is bullish.
The 50 day moving average is higher at 5523. This is bullish.
The 100 day moving average is rising and closed at 5438 which is bullish.
The 200 day moving average is in an uptrend and closed at 5214 which is bullish.
The Lower Bollinger Band is below the 100 day moving average which is bullish.
The Upper Bollinger Band is turning higher which is bullish.
The S&P chart is more bullish than bearish for Thursday with just one warning of a small dip.
SPX Stock Market Outlook review of Wed Sep 25 2024
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is falling and positive.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Fri Sep 13 2024. The up signal was weaker on Wednesday.
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Ultimate Oscillator: The Ultimate Oscillator is rising and positive.
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Slow Stochastic: The Slow Stochastic has an up signal and is at overbought levels.
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Relative Strength Index: The RSI signal is falling and positive. It is at overbought levels.
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Rate of Change: The rate of change signal is rising which advises Thursday will end higher.
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Stock Market Outlook: Support and Resistance Levels |
| 5740 is resistance |
| 5715 is resistance |
| 5700 is resistance |
| 5650 is resistance |
| 5625 is resistance |
| 5615 is resistance |
| 5600 is resistance |
| 5575 is resistance |
| 5550 is light support |
| 5525 is support |
| 5500 is support |
| 5470 is support |
| 5450 is support |
| 5425 is support |
| 5400 is support |
Stock Market Outlook for Thu Sep 26 2024
For Thursday the technical indicators are showing a bit more weakness but still nothing to be concerned about. A small dip today should be expected and indeed the index could fall to 5700 but investors have shown an interest in buying every dip. I would expect the same to occur today.
On Wednesday home sales came in higher than forecast at 716,000 but below 751,000 prior. The housing market is slowing and that concerns investors.
The momentum and MACD technical indicators are showing signs of losing strength but are nowhere near negative readings which basically advises the sideways action of the index over the past several days is wearing down momentum. This will assist in reducing the overbought environment stocks are in and will help them move higher in the next push.
With Micron earnings released that were far better than estimated, the index could open higher and attempt to build some momentum to the upside.
Also for Thursday watch the Weekly Initial Unemployment Insurance Claims which are out at 8:30. They could affect market action, certainly first thing in the morning.
Overall the outlook for the SPX is for a choppy day with a dip possible but a higher close.
Potential Economic and Political Market Moving Events
Monday:
9:45 S&P flash services PMI came in as expected at 55.4
9:45 S&P flash manufacturing PMI was lower than expected at 47
Tuesday:
9:00 Case-Shiller home price index came in lower than expected at 5.9%
10:00 Consumer confidence was a lot lower than expected coming in at 98.7
Wednesday:
10:00 New homes sales rose to 716,000 which was above estimated of 700,000
Thursday:
8:30 Weekly Initial Unemployment Insurance Claims are estimated to rise to 223,000
8:30 Durable goods orders are expected to drop to -3.0%
8:30 GDP (second revision) is estimated at 3.0% for the quarter
10:00 Pending home sales are expected to rise 1.0%
7 Fed officials are speaking at various times and locations throughout the day continuing to push the declining interest rate narrative. This should be bullish for stocks.