Prior Trading Day Summary
On Tue Dec 30 2025 trading volume was still well below average as holiday trading continued with many investors not participating. Next week we should see volumes begin to return to normal.
The S&P closed down just 9 points to 6896 on just 3.3 billion shares traded. 53% of the volume was being traded higher intraday but 51% of stocks closed lower. The index was actually unchanged at 6905 at 3:40 which would have made for a neutral close. The lower close was all in the last 20 minutes of the day.
The NASDAQ fell 55 points closing at 23419. Volume was 6.9 billion shares traded. 54% of volume was being traded higher but 60% of stocks on the index were declining.
Overall losses remain small and continue to point to just profit-taking. The anticipated Santa Claus Rally has not appeared but there are three trading days left for the rally to get underway. Normally the Santa Claus rally is the last 5 trading days of December and the first 2 trading days of January. On the 24th of December the SPX ended the day up 22 points to 6932. Since then losses have been small. It won’t take much of a bounce to see the rally end with stocks higher.
Let’s review the closing technical indicators from Tue Dec 30 2025 to see what to expect for the half day of trading on Wed Dec 31 2025.
Stock Market Outlook: SPX Closing Chart For Tue Dec 30 2025
The index closed below the Upper Bollinger Band and above all the major moving averages. This is bullish.
The closing candlestick is neutral for Wednesday.
The 21 day moving average is rising and closed at 6853. This is bullish but the rise in the 21 day is slowing considerably.
The 50 day moving average is rising and closed at 6800 which is bullish.
The 100 day moving average is rising and closed at 6653 which is bullish.
The 200 day moving average is rising and closed at 6407 which is bullish.
The Lower Bollinger Band is falling but still above the 100 day moving average. This is neutral. The Upper Bollinger Band is rising which is bullish. A Bollinger Bands Squeeze is underway. The initial outlook appears for the index to move higher.
The SPX chart is slightly more bullish than bearish for Wed Dec 31 2025. Bearish signals have grown over the past two trading days.
SPX Stock Market Outlook review of Tue Dec 30 2025
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is rising and positive. This is bullish.
|
MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued an up signal on Tue Dec 23 2025. The up signal was weaker on Tue Dec 30 2025.
|
Ultimate Oscillator: The Ultimate Oscillator is falling.
|
Slow Stochastic: The Slow Stochastic has a down signal in place and is overbought.
|
Relative Strength Index: The RSI signal is falling.
|
| Rate of Change: The rate of change is falling and signaling a possible lower close on Wednesday. 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 |
| 6950 is resistance |
| 6925 is resistance |
| 6900 is resistance |
| 6875 is resistance |
| 6850 is resistance |
| 6800 is resistance |
| 6775 is resistance |
| 6750 is resistance |
| 6715 is resistance |
| 6700 is resistance |
| 6675 is support |
| 6650 is support |
| 6625 is support |
| 6600 is support |
| 6590 is support |
| 6570 is support |
| 6550 is support |
| 6500 is support |
Stock Market Outlook for Wed Dec 31 2025
Wednesday is a half day with trading stopping at 1:00. The outlook is for a neutral to slightly lower close on Wednesday. Friday still looks like we could see a move higher.
Normally low volume favors the bulls but over the last 3 trading days, low volume is keeping a lid on any bullish push higher. Losses though are very small which continues to signal that a bounce higher is more likely to start January than a decline.
On Wednesday watch for a very low volume day and a slightly lower close.
It was interesting that the Fed minutes showed on Tuesday that the decision was not unanimous to cut rates. This may weigh on the next Fed interest rate decision.
Potential Economic and Political Market Moving Events
Monday:
10:00 Pending Home Sales rose more than estimated to 3.3%
Tuesday:
9:00 S&P Case-Shiller home price index was better than estimated, coming in at 1.3% but still lower than 1.4% prior.
2:00 Minutes of Fed’s December FOMC meeting
Wednesday:
8:30 Weekly Initial Unemployment Insurance Claims are estimated to rise by 6,000 to 220,000
Thursday:
New Year’s Day holiday
Friday:
9:45 S&P final manufacturing is estimated to slip slightly to 51.7 from 51.8