Monday saw the biggest rally of March. The developers were working late into the early morning on Tuesday installing the latest investing tools. This doesn’t leave me with a lot of time for a major review, so here is a short review and outlook for Tue Mar 12 2019.
Stock Market Outlook Chart Comments At The Close on Mon Mar 11 2019
The most important event on Monday was the 100 day moving average climbing above the 200 day. This is a major up signal for the rally. This is now the 4th up signal. This eliminated two of the down signals from October 2018.
The Lower Bollinger Band is also moving higher and the Bollinger Bands Squeeze is now underway. Stocks could end up moving higher out of this latest Bollinger Bands Squeeze. We will know shortly.
The closing candlestick is bullish for Tuesday.
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is negative but rising.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Thursday February 28 2019. The sell signal was weaker on Monday but still fairly strong.
- 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 is rising and positive.
- 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 has a weak down signal in place for Tuesday.
- 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 is rising from being oversold.
- 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:
2900 was support – this will be strong resistance
2860 was support – this will be resistance
2830 was light support and will be light resistance
2800 is strong resistance
2795 is light resistance
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.
2300 has the most support at present but would represent a full correction of 641 points as a drop to this level would be 21% and just 5% away from a full bear market signal ending the bull market from 2009.
Stock Market Outlook for Tomorrow – Tue Mar 12 2019
The technical indicators are turning back to the bullish side. After the big run-up on Monday, don’t be surprised if the morning sees some weakness, but the close should be positive and higher for the S&P by the end of Tuesday’s trading.
Stock Market Outlook Archives