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Stock Market Outlook for Tue May 14 2024 – All About The PPI Numbers – Mixed Outlook

May 14, 2024 | Stock Market Outlook

Prior Trading Day Summary:

On Monday stocks spent most of the day drifting sideways while waiting for the PPI numbers on Tuesday and CPI numbers on Thursday. Both of these numbers will give a clearer picture of the inflation outlook.

The SPX ended the day down just 1 point while the NASDAQ closed up 47 points.

Let’s review the closing technical indicators from Mon May 13 2024to see what to expect for Tue May 14 2024.


Stock Market Outlook: SPX Closing Chart For Mon May 13 2024

The index closed above the 21 day moving average and the 50 day and at the Upper Bollinger Band. This is bullish.

The closing candlestick is bullish for Tuesday.

The 21 day moving average is still below the 50 day moving average for a down signal. It is still not showing signs of moving back up. This is bearish.

The 50 day moving average is climbing which is bullish.

The 200 day moving average is still climbing. The 200 day is at 4787 which is bullish and the 100 day is also climbing.

The Lower Bollinger Band is below the 100 day moving average and starting to turn lower. This is bullish. The Upper Bollinger Band is turning higher. This is bullish.

The S&P chart is more bullish that bearish for Tuesday which could support the bulls even if the PPI numbers disappoint.

SPX Stock Market Outlook review of Mon May 13 2024 – chart courtesy TradingView


Stock Market Outlook: Technical Indicators Review

Momentum: Momentum is falling and positive.

  • Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Fri May 3. The up signal gained more strength on Mon May 13 2024.

  • 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 is falling.

  • 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 potential change signal in place and 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 is falling and positive. It 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 signaling that Tuesday will be higher.

  • 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.

Stock Market Outlook: Support and Resistance Levels

5275 is resistance
5250 is resistance
5225 is resistance
5200 is resistance
5190 is resistance
5175 is resistance
5150 is resistance
5125 is support
5115 is support
5100 is support
5075 is support
5050 is support
5025 is support
5000 is light support
4990 is light support
4975 is light support
4950 is support


Stock Market Outlook for Tue May 14 2024 

On Tuesday investors get the latest Producer Price reports. As well Fed Chair Powell speaks at 10:30. These events could swing stocks up or down. However for Tuesday the technical indicators are mixed. Overall the bias is still to the bulls even if the PPI numbers disappoint. The initial reaction could be to sell stocks lower but the technical indicators are advising that any dip, especially a strong one, will find ready buyers.

If the PPI numbers are weaker than estimated, watch for stocks to initially rally. The PPI numbers are released at 8:30.

Fed Chair Powell speaks at 10:00 AM. Watch for a rally or a drop as he speaks. Once he is done speaking however, I expect stocks to regain their losses and move higher.


Potential Economic and Political Market Moving Events

There are a number of reports this week that will impact markets. The Producer Price Index on Tuesday and Consumer Price Index on Wednesday could move markets.

Monday:

There are no reports released today.






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