Stock Market Outlook for Wed Jun 5 2024 – Choppy – Dips Possible But Still Up

Prior Trading Day Summary:

On Tue Jun 4 2024 stocks once again saw a choppy session with both dips and spikes. By the close the index managed to squeak out another positive close. The SPX rose 8 points to close at 5291.

The NASDAQ continued to see selling particularly among the semi-conductors but the close was positive for a second straight day. The index closed up 28 points to close at 16,857.

On Tuesday factory orders came in as expected but job openings slipped 300,000 to 8.1 million. This was enough to pressure treasury yields lower which helped push stocks higher.

Let review the closing technical signals from Tue Jun 4 2024 to see how what to expect for Wed Jun 5 2024.

Stock Market Outlook: SPX Closing Chart For Tue Jun 4 2024

The index closed above the 21 day moving average which is bullish.

The closing candlestick is bullish but the long shadow (tail) is another warning there will be some selling on Wednesday.

The 21 day moving average is still climbing continuing the latest up signal.

The 50 day moving average is climbing which is bullish.

The 200 day moving average is still climbing. The 200 day is at 4856 which is bullish and the 100 day is also climbing to 5069.

The Lower Bollinger Band is now at the 50 day moving average. The Upper Bollinger Band is turned lower as the SPX is in a Bollinger Bands Squeeze.

The S&P chart is more bullish than bearish but there are warnings of weakness from the closing candlestick and the Bollinger Bands Squeeze to contend with.

SPX Stock Market Outlook review of Tue Jun 4 2024 – chart courtesy TradingView

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Wed Jun 5 2024 

For Wednesday stocks should close higher if Treasury yields do not rise. There will be more choppiness today and dips remain likely. At present dips are still opportunities to setup trades as the outlook is still positive for stocks. Friday’s non-farm payroll numbers for May could change that outlook but even if the index falls back after the May numbers are known, the underlying trend is still higher.

On Tuesday job opening slipped by 300,000 to 8.1 million and analysts jumped on the lower number as a signal that the Fed will be cutting interest rates soon as they believe the lower number shows the economy is slowing. They could be right, but the overall job openings was 8.1 million which is still very healthy and shows expansion of the economy is ongoing.

Potential Economic and Political Market Moving Events

This is a big week for economic numbers culminating in the May non-farm payroll numbers due out on Friday June 7 at 8:30.

Monday:

9:45 S&P flash manufacturing PMI was expected to slip slightly to 50.7 from 50.9 but rose to 51.3

10:00 Construction spending for April was expecting to rise to 0.2% from negative 0.2% prior but instead it fell to -0.1%

10:00 ISM manufacturing for May was expected to rise to 49.6% from 49.2% but fell instead to 48.7%

Auto Sales are released during the morning were expected to be around 15.9 million units but came in at 15.7 million

Tuesday:

10:00 Factory orders fell to 0.7% as expected

10:00 Job openings are dipped lower than expected to 8.1 million from 8.4 million.

Wednesday:

8:15 ADP employment is expected to come in lower at 175,000

9:45 S&P flash services PMI is estimated unchanged at 54.8

10:00 ISM services for May are estimated at 50.7%, up from prior 49.4%.