On Monday the S&P pushed to 2900 by the start of the noon hour. That marked the high of the day. From there sellers pushed stocks lower right into the close of the day.
Stock Market Outlook Chart Comments At The Close on Mon Jun 10 2019
On Monday the index the the index moved above the 50 day moving average and closed above it but the push higher saw a lot of sellers. This left behind a bearish candlestick for Tuesday and a chance for a negative day.
There is still one sell signal in play.
The Lower Bollinger Band is still turning up but the Upper Bollinger Band is also staring to turn up. We may not see the anticipated Bollinger Bands Squeeze later this week.
Aside from the sell signal, the chart is very bullish with the major moving averages climbing higher.
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is positive and rising.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Thursday June 6. The up signal was stronger today.
- Settings: For MACD Histogram, I am using the Fast Points set at 13, Slow Points at 26 and Smoothing at 9.
Ultimate Oscillator: The Ultimate Oscillator signal was unchanged and now overbought.
- Settings: 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.
Slow Stochastic: The Slow Stochastic signal is still pointing up for stocks but is overbought.
- Settings: 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.
Relative Strength Index: The RSI signal also is rising and it too is overbought.
- Settings: The relative strength index is set for a period of 5 which gives it 5 days of market movement to monitor. It is often the first indicator to show an overbought or oversold signal.
Rate of Change: The rate of change signal is rising indicating higher prices lie ahead.
- Settings: 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. With the Rate Of Change, prices are rising when signals are positive. Conversely, prices are falling when signals are negative. As an advance rises the Rate Of Change signal should also rise higher, otherwise the rally is suspect. A decline should see the Rate Of Change fall into negative signals. The more negative the signals the stronger the decline.
Support Resistance Levels To Be Aware Of:
2950 is resistance
2900 is resistance
2860 is light support
2830 is light support
2800 is strong support
2795 is light support
2745 to 2750 is light support
2725 is light support
2700 is light support
2675 is light support
2650 is support
2625 is light support
2600 is support.
There was good support at the 2550 level which is back to being support.
The 2500 level is support.
The S&P has light support at 2480 and better support at 2450.
There is good support at 2425.
Below that there is some support at 2400, 2380, 2350.
Stock Market Outlook for Tomorrow – Tue Jun 11 2019
Tuesday may open higher but the overbought signals and the closing candlestick suggest a negative day may occur on Tuesday.
The bias is still up for stocks as the up signals from the technical indicators are quite strong so any dip at this point will be temporary.
If Tuesday does end higher, Wednesday will see the market with a negative close as the indexes deal with the overbought signal.