Wednesday saw the US dollar rise pressuring gold and other commodities. But new highs were closed at once again and news that the tax reform package should be unveiled for September 25, by President Trump should be enough to push stocks higher on Thursday. Here is the outlook for Thursday Sep 14 2017.
S&P 500 Index Close
The S&P index ended up 1.89 to 2498.37
Dow Jones Index Close
The Dow Jones ended up 39.32 at 22,158.18
NASDAQ Index Close
The NASDAQ closed up 5.91 to close at 6460.19
Stock Market Outlook
Chart Comments At The Close:
The S&P on Wednesday closed back inside the Upper Bollinger Band which is bullish but also signals a growing weakness in momentum to the upside.
The 21 day is still trying to recover back above the 50 day moving average. The closing candlestick is bullish for Thursday.
The 100 and 200 day moving averages are continuing to climb higher.
Stock Market Outlook: Technical Indicators:
Momentum: For momentum I use a 10 period when studying market direction. Momentum is positive and moving sideways.
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 buy signal on Aug 31. The buy signal was stronger on Wednesday.
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 positive and rising into overbought signals.
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 an up signal in place for Thursday and is very overbought.
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 higher and into overbought readings.
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 but dropped lower which indicates that prices may have topped for the moment, and a dip should be expected.
Support Levels To Be Aware Of:
The market has 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 Sep 14 2017
Wednesday saw stocks turn sideways and the technical indicators also reflected the change in trend. There are still the same number of positive indicators but there are signals the market is overbought and due for a bit of a stall and probably small dips.
The market has become overbought, which considering the height of the market and the three-day rally is not unusual and it does not signal the end of the rally. We should see the S&P try against to break through the 2500 level and then close back below it for a second day,
Therefore the outlook for Thursday is overbought with a slightly negative bias. The underlying bias though is still up.
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