Day’s Summary
On Tuesday stocks opened the day with a large plunge as Moody’s rating agency downgraded a number of regional and smaller banks and warned that larger banks were being examined for possible ratings changes. That sent investors to the exit on most financial stocks but the open also proved to be the worst part of the day. By the close the S&P had recovered much of the loss and was down just 19 points at 4499. The recovery back to 4500 in the SPX is important for the support level. This is building more support for the index.
The NASDAQ lost 110 points to end the day at 13,884.
Let’s review the technical indicators from the close on Tuesday to see what to expect for Wednesday’s trading.
Stock Market Outlook: SPX Closing Chart For Tue Aug 8 2023
The index closed below the 21 day moving average for a fourth day. This is bearish.
The closing candlestick on Tuesday is bearish but is often seen before a bounce attempt.
The 21 day moving average is back climbing. The 50, 100 and 200 day moving averages are also continuing to climb which is bullish.
The Lower Bollinger Band rose further above the 50 day moving average which is bearish. The Upper Bollinger Band is turning lower which is also bearish. A new Bollinger Bands Squeeze is underway. At present the squeeze looks like stocks will move lower but often stocks actually dip and then recover to move higher.
Stock Market Outlook review of Tue Aug 8 2023
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is falling and negative.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Thursday Jul 27. On Tue Aug 8 2023 the down signal increased in strength.
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Ultimate Oscillator: The Ultimate Oscillator is rising, negative and trying to bounce from oversold.
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Slow Stochastic: The Slow Stochastic has an up signal in place. It is oversold but also signaling there is a chance for a bounce attempt coming.
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Relative Strength Index: The RSI signal is falling and negative.
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Rate of Change: The rate of change signal is falling.
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Stock Market Outlook: Support and Resistance Levels |
| 4600 is resistance |
| 4575 is resistance |
| 4550 is resistance |
| 4525 is resistance |
| 4500 is support |
| 4485 is support |
| 4470 is support |
| 4450 is support |
| 4435 is support |
| 4420 is support |
| 4400 is support |
| 4390 is support |
| 4370 is support |
| 4350 is support |
| 4340 is support |
| 4325 is support |
| 4310 is support |
| 4300 is support |
| 4290 is support |
| 4275 is support |
| 4250 is support |
| 4240 is support |
| 4225 is support |
| 4210 is support |
| 4200 is good support |
Stock Market Outlook for Wed Aug 9 2023
The 4500 level in the SPX is being tested for support. There are a number of signals advising that the 4500 may hold up and assist the index to move higher shortly.
For Wednesday the technical indicators are showing the market preparing to attempt another bounce despite Tuesday’s selling. With the next CPI numbers due out on Thursday, we could see the index try to rally in the later afternoon.
Potential Economic and Political Market Moving Events
The big event this week is on Thursday with CPI numbers
Wednesday:
No events to report on