Prior Trading Day Summary:
On Tuesday the morning started with a dip down to 5131 but buyers were waiting for the dip and volumes picked up. Deep dips in a number of big caps like NVIDIA Stock (NVDA) found ready buyers to snap up shares. NVIDIA Stock (NVDA) ended up closing higher on the day. By the close on Tuesday the S&P was at another new all-time high. The index rose 29 points to close at 5178.
The NASDAQ closed up 63 points to 16,166.
On Wednesday investors get the latest Fed decision on interest rates at 2:00. The overwhelming consensus is for no change to rates. At 2:30 Fed Chair Powell’s news conference gets underway and sometimes this can be the more volatile event which can swing stocks higher or lower. For tomorrow though most investors and analysts believe it will be a non-event and no change is expected.
Also Wednesday after the close we get earnings from Micron Technology Stock (MU) which could sway the semiconductor stocks depending on their earnings. Other big name stocks that have an impact which release earnings after the close include Chewy Stock (CHWY), Five Below Stock (FIVE), KB Home Stock (KBH) and Guess? Stock (GES) which should give some idea as to how consumers are faring. Chewy earnings in particular will be interesting as consumers tend to spend on their pets with lower regard for rising prices. If Chewy earnings are better than expected it will bode well for the retail sector of the economy and many retail stocks. The other stock being watched after hours is Worthington (WOR) which as a steel company should give some idea how the industrial sector is faring. Their earnings, if they miss could impact stocks like Nucor Stock (NUE) and that could setup some trades for Thursday.
So as you can see Wednesday promises to be a very busy day for the markets.
Let’s review the close on Tue Mar 19 2024 to see what to expect for Wed Mar 20 2024.
Stock Market Outlook: SPX Closing Chart For Tue Mar 19 2024
The index closed below the Upper Bollinger Band and well above the 21 day moving average. This is bullish for the index.
The closing candlestick is bullish for Wednesday.
The 21 day moving average is moving higher which is bullish. It is at 5100 on the SPX.
The 50 day moving average is rising and at 4970, which is bullish.
The 100 and 200 day moving averages are climbing which is bullish. The 200 day is at 4620 on the SPX which is bullish.
The Bollinger Bands are still in a Bollinger Bands Squeeze. The Lower Bollinger Band moved back above the 50 day on Thursday last week which is bearish. It is now starting to turn higher. The Upper Bollinger Band is also starting to turn higher. This is bullish and may signal stocks will move higher out of this latest Bollinger Bands Squeeze.
The S&P chart is bullish for Wednesday with no bearish signals.
SPX Stock Market Outlook review of Tue Mar 19 2024
Stock Market Outlook: Technical Indicators Review
Momentum: Momentum is rising and back positive.
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MACD Histogram: MACD (Moving Averages Convergence / Divergence) issued a down signal on Tue Mar 5. On Mon Mar 18 2024 the down signal lost half of its strength.
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Ultimate Oscillator: The Ultimate Oscillator is rising and positive.
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Slow Stochastic: The Slow Stochastic has an up signal in place and is not overbought.
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Relative Strength Index: The RSI signal is rising and positive.
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Rate of Change: The rate of change signal is rising indicating Wednesday will be higher for the index.
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Stock Market Outlook: Support and Resistance Levels |
| 5250 is resistance |
| 5225 is resistance |
| 5200 is resistance |
| 5190 is resistance |
| 5175 is resistance |
| 5150 is resistance |
| 5125 is resistance |
| 5115 is resistance |
| 5100 is resistance |
| 5090 is resistance |
| 5075 is resistance |
| 5050 is support |
| 5025 is support |
| 5000 is light support |
| 4990 is light support |
| 4975 is light support |
| 4950 is support |
| 4925 is support |
| 4915 is support |
| 4900 is support |
Stock Market Outlook for Wed Mar 20 2024
As of the close on Tuesday, the 5050 level became light support for the ongoing rally. This is important especially if pundits are correct that there “has to be a correction” soon. If there is such a correction “soon”, it may find falling below 5050 difficult.
For Wednesday the technical indicators are advising that unless the Fed were to raise interest rates which is extremely unlikely, the day will end higher, no matter what the initial reaction to the FOMC interest rate announcement and press conference contains.
All the technical indicators are showing more strength to the upside including the Moving Average Convergence / Divergence indicator which is signaling that the down signal is evaporating,
On Wednesday any dip is an opportunity to setup more trades which is what I will be busy doing.
Potential Economic and Political Market Moving Events
Wednesday and Thursday are the busiest days for economic reports that could change market direction.
Monday:
10:00 Home Builder confidence index came in as expected at 48 which is basically “steady” for housing.
Tuesday:
8:30 Housing starts are expected at 1.43 million
8:30 Building permits are estimated to be 1.49 million
Wednesday:
2:00 FOMC interest rate decision
2:30 Fed Chair Powell news conference