Prior Trading Day Summary:
On Monday investors were disappointed by Fed Powell’s comments on the weekend regarding little to no chance for a March interest rate cut. As well the outlook seemed to change to a handful of rate cuts being possible later in the year but probably not as many as most analysts had expected as the economy remains growing.
The S&P lost 15 points but closed well off the morning lows ending the day at 4942.
The NASDAQ lost 31 points to close at 15,597, also well off the morning low.
Let’s review Monday’s closing technical indicators to see what to expect for Tue Feb 6 2024.
Stock Market Outlook: SPX Closing Chart For Mon Feb 5 2024
The index closed just below Upper Bollinger Band which is bullish.
The 21 day moving average is moving higher which is bullish. It is above the 4800 valuation.
The closing candlestick has a long shadow indicating there is a chance for a move higher on Tuesday or a bounce.
The 50 day moving average is above the 100 day and still climbing which is bullish.
The 100 and 200 day moving averages are climbing which is bullish. The 200 day is above the 4400 on the SPX which is bullish.
The Lower Bollinger Band is rising ad is the Upper Bollinger Band. At present this is bullish.
The S&P chart is bullish for Tuesday.
Stock Market Outlook review of Mon Feb 5 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 Tue Jan 23 2024. On Mon Feb 5 2024 the up signal was unchanged from Friday’s close.
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Ultimate Oscillator: The Ultimate Oscillator is falling and positive.
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Slow Stochastic: The Slow Stochastic has an up signal in place and is overbought.
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Relative Strength Index: The RSI signal is falling and positive. It is leaving overbought readings.
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Rate of Change: The rate of change signal is unchanged signaling Tuesday may not be much different from Monday.
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Stock Market Outlook: Support and Resistance Levels |
| 4990 is resistance |
| 4975 is resistance |
| 4950 is resistance |
| 4925 is resistance |
| 4915 is resistance |
| 4900 is resistance |
| 4875 is resistance |
| 4850 is resistance |
| 4825 is resistance |
| 4815 is resistance |
| 4800 is resistance |
| 4780 is support |
| 4750 is support |
| 4720 is support |
| 4700 is support |
| 4675 is support |
| 4650 is support |
| 4625 is support |
| 4600 is support |
| 4590 is support |
| 4575 is light support |
| 4565 is light support |
| 4550 is support |
| 4500 is support |
Stock Market Outlook for Tue Feb 6 2024
The technical indicators are still mixed but there is more of a bias to weakness than to strength. As well the Market Breadth Indicators are narrowing further as the rally is trying to move higher but on fewer stocks. This won’t last without more stocks rising.
For Tuesday there are signs the SPX will dip but try to move higher. The market breadth though must improve or the rally will stall and stocks pullback.
Potential Economic and Political Market Moving Events
There are not as many events this week that will impact stocks. That should help the bulls.
Monday:
9:45 Final service PMI is expected to be unchanged at 52.9 but came in slightly lower at 52.5
10:00 ISM services is expected at 52.0% but rose slightly to 52.5%
Tuesday:
4 Fed Presidents speak during the day but there are no economic reports to move the markets. This could support the bulls.