Stock Market Outlook for Wed Jul 14 2021 – Choppy, Dips Likely But Higher

Tuesday the CPI number surprised as it came in higher than expected at 5.4%. Indexes slipped on the news despite excellent bank earnings to start off the next quarterly earnings.

Losses by the close were mild with the S&P losing 15 points to close at 4369, a dip of 0.35%. Let’s review Tuesday’s closing technical signals and chart to see what’s in-store for Wednesday.

Stock Market Outlook Chart Comments At The Close on Tue Jul 13 2021 

The S&P closed below the Upper Bollinger Band. Meanwhile the Lower Bollinger Band slowed its descent which is bearish. The Upper Bollinger Band is still rising.

The closing candlestick on Tuesday is bearish for Wednesday.

All the major moving averages are climbing. The chart is more bullish for Wednesday than bearish but the closing candlestick and the Lower Bollinger Band are advising to stay cautious.

Stock Market Outlook review of Tue Jul 13 2021

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 Friday June 25. That up signal lost some strength on Tuesday.

• 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 and signaling 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 has an up signal in place and is signaling extremely 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.

• 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 falling.

• 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 and Resistance Levels To Be Aware Of:

4400 is resistance

4370 is resistance

4350 is resistance

4300 is light support

4290 is light support

4270 is light support

4250 is light support

4225 is light support

4200 is light support

4175 is light support

4150 is light support

4100 is good support

4070 is light support

4050 is light support

4000 is good support

3900 is support

3850 is support

3800 is support

3750 is good support

3700 is light support

3680 is light support

3600 is strong support

 Stock Market Outlook for Tomorrow – Wed Jul 14 2021 

For Wednesday investors get more bank earnings and that could help against a few bearish signals both in the chart and in the technical indicators.

The dip was mild on Tuesday and Wednesday should see the index struggle again but close positive. Trading though will be choppy but dips are still opportunities to setup trades.

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