Stock Market Outlook For Wed May 14 2025 – Overbought – Dips Probable But Still Higher

Prior Trading Day Summary:

On Tuesday the rally from Monday continued although trading was choppy and the close saw the SPX fall from 5906 to 5886 in 20 minutes on strong volume. This continues to show nervousness among a lot of investors who seem to be waiting for the “second shoe” to drop. I think they may be disappointed, certainly in the short-term. The rally in the SPX over the past 6 weeks has been the best short-term rally since 1982 according to my records going back to 1974.

The S&P closed up 42 points to close at 5,886. Volume was lower by 400 million shares with 5.6 billion shares traded. 66% of trading volume was to the upside.

The NASDAQ had another strong day, rising 301 points to close at 19,010. This is the highest close since Feb 26 when the NASDAQ ended the day at 19,075. Volume was good at 9.5 billion shares traded. 65% of the volume was to the upside.

Let’s review the technical indicators from the close on Tue May 13 2025 to see what we should expect for Wed May 14 2025.

Stock Market Outlook: SPX Closing Chart For Tue May 13 2025

The index closed above all major moving averages and at the Upper Bollinger Band. This signals overbought but also bullish.

The closing candlestick is bullish but the closing shadow, also signals dips are likely.

The 21 day moving average is rising and closed at 5502 which is bullish. It may move above the 50 day on Wednesday which would be a major up signal. The 21 day moving average fell below the 50 day on Friday Mar 7. It fell below the 100 day on Thursday Mar 13 for a second down signal and on Friday Mar 28 it fell below the 200 day for a third down signal.

The 50 day moving average is frising and closed at 5550 which is bearish. The 50 day moving average fell below the 100 day on Tue April 15 which issued a 4th down signal on the SPX. The 50 day on Friday May 2 fell below the 200 day for a 5th down signal.

The 100 day moving average is rising and closed at 5681 which is bullish.

The 200 day moving average is rising and closed at 5642 which is bullish.

The Lower Bollinger Band is turning lower which is bullish. The Upper Bollinger Band is rising which is bullish.

For Wed May 14 2025 the SPX chart is more bullish than bearish.

SPX Stock Market Outlook review of Tue May 13 2025

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Wed May 14 2025 

To start the day on Wednesday there are three more support levels in place following Tuesday’s rally. The 5600, 5630 and 5650 levels in the SPX are back as support. The index is pushing into major resistance levels. We should see some dips today but they are opportunities to setup new trades. Dips at present will quickly find buyers, as many investors missed the monster rally back, in the SPX and NASDAQ indexes.

Investors are surprised by the strength of the rally and many are still on the sidelines. As the rally has pushed higher, more investors are being dragged back into the rally. This could set the index up for another rally higher.

Wednesday should see the index somewhat battered, but higher by the close.

Potential Economic and Political Market Moving Events

Monday:

2:00 Monthly federal budget for April came in slightly higher than estimated at $258 billion

Tuesday:

6:00 NFIB optimism index is expected to slip slightly to 95.0

8:30 Consumer price index is expected to rise to 0.2% from -0.1%

8:30 Consumer Price Index (CPI) year-over-year are estimated unchanged at 2.4%

8:30 Core CPI is expected to rise slightly to 0.3% from 0.1% prior

8:30 Core CPI year-over-year is estimated to rise to 2.9% from 2.8% prior