Stock Market Outlook for Tue Dec 17 2024 – Bullish Ahead Of The FED

Prior Trading Day Summary:

Monday was a choppy day on the markets with Dow Jones Index falling yet again but the SPX and NASDAQ both managed to end the day positive.

The S&P closed up 23 points to 6074. The NASDAQ closed up 247 points to 20173.89, a new all-time closing high.

Volume foe the S&P rose 800 million shares to 4.5 billion but new lows still out-distanced new highs 132 to 81. As well down volume was 61% and 58% of all stocks were falling.

The NASDAQ saw one of its heaviest days with 9 billion shares treded. Again new lows out-distanced new highs by 235 to 208 but 70% of all volume was rising and 50% of all stocks were advancing.

Market breadth continues to be poor and concern is mounting that after the Fed’s interest rate announcement, it may become a case of “sell the news”.

Let’s review the technical indicators at the close on Mon Dec 16 2024 to see what to expect for Tue Dec 17 2024.

Stock Market Outlook: SPX Closing Chart For Mon Dec 16 2024

The index closed higher on Monday but well off the day’s high which is bearish.

The closing candlestick is bearish for Tuesday with a shadow which often indicates selling pressure to start the day on Tuesday.

The 21 day moving average is higher at 6012. The rally is slowing considerably and most noticeable in the 21 day.

The 50 day moving average is higher at 5912. This is bullish.

The 100 day moving average is rising and closed at 5770which is bullish.

The 200 day moving average is in an uptrend and closed at 5515 which is bullish.

The Lower Bollinger Band is below the 50 day. This is bearish. It is not however falling further. The Upper Bollinger Band is rising which is bullish. At present the outlook has shifted to bearish for the Bollinger Bands.

The S&P chart is more bearish than bullish for Tuesday.

SPX Stock Market Outlook review of Mon Dec 16 2024

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Tue Dec 17 2024 

For Tuesday investors ware positioning themselves for the Fed’s interest rate announcement. The overwhelming consensus is for a quarter point rate cut and Fed comments on slowing the rate cuts in 2025 or becoming more “data dependent”, as the Fed Chair will probably put it. Tuesday should end higher in anticipation of the rate cut but there is concern that once the rate cut is announced, investors will “sell the news”, basically meaning, they will take year-end profits. I will be placing a SPY trade today ahead of Wednesday’s announcement.

Potential Economic and Political Market Moving Events

Monday:

8:30 Empire State manufacturing survey was much worse than expecting coming in at just 0.2 versus 31.2 prior.

9:45 S&P flash US service PMI rose to 58.5 rather than slipped.

9:45 S&P flash US manufacturing PMI slipped more than estimated to 48.3 from 49.7 prior

Tuesday:

8:30 Retail sales are estimated to rise slightly to 0.5% from 0.4% prior

8:30 Retail sales minus autos is estimated at 0.3% versus 0.1% prior

9:15 Industrial production is estimated to rise to 0.3% from -0.3% prior

9:15 Capacity utilization is estimated to ruse slightly to 77.2% from 77.1% prior

10:00 Home Builder Confidence index is estimated to rise slightly to 47 from 46 prior