Wednesday Aug 16 2017 saw stocks trading positively until shortly after 2:00 PM when the Fed minutes were released. The Minutes indicated there is a split among Fed members on the timing of reducing the Fed’s balance sheet but Fed Chair Janet Yellen appeared ready to commence its reduction earlier rather than later this year. That combined with news of President’s Trump’s ending of his Manufacturing Council as more and more corporations backed out was enough to end the rally. Stock indexes still managed small gains but the highs of the day were lost.
S&P Index Close
The S&P index ended up 3.50 to 2468.11.
Dow Jones Index Close
The Dow Jones ended up 25.88 to 22,024.87.
NASDAQ Index Close
The NASDAQ closed up 12.10 to 6345.11.
Stock Market Outlook
Stock Market Outlook review of Wed Aug 16 2017
Chart Comments At The Close:
The S&P moved slightly higher to close at the 21 day moving average. The close left behind a bearish candlestick for Thursday.
All the major indexes are climbing higher. The Bollinger Bands Squeeze is underway with no clear signal whether stocks will move up or down out of the squeeze.
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is negative and unchanged.
MACD Histogram: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9. MACD (Moving Averages Convergence / Divergence) issued a sell signal on Aug 3. The sell signal is still strong but you can see that the MACD histogram is starting to weaken for another day.
Ultimate Oscillator: 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. The Ultimate Oscillator is back negative and lower.
Slow Stochastic: 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. The Slow Stochastic has a buy signal in place for Thursday.
Relative Strength Index: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It often is the first indicator to show an overbought or oversold signal. The RSI signal is unchanged for Thursday.
Rate of Change: 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. The rate of change signal is positive and moving sideways.
Support Levels To Be Aware Of:
The market has developed light support at 2450 and good support at 2425. There is also light support at 2400, 2380, 2350 and 2300.
Stock Market Outlook for Tomorrow – Thursday Aug 17 2017
For Thursday the technical indicators are still split. There is just one with a buy signal, two that are positive but moving sideways. 3 are negative. This gives us another sideways outlook for the S&P for Thursday Aug 17 2017. Meanwhile looking at the indicators, the bias is also lower as well as sideways.
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