On Tuesday stocks continued to stay under some selling pressure. Both the S&P and NASDAQ closed lower.
The S&P lost 47 points for a 1.12% drop. The index ended the day at 4145.
The NASDAQ lost 160 points to end the day at 12,560.
Let’s review the SPX closing technical indicators on Tue May 23 to see what to expect for Wed May 24 2023.
Stock Market Outlook Chart Comments At The Close on Tue May 23 2023
The index closed with a bearish candlestick for Wednesday.
The SPX closed above the 21 day moving average but below the Upper Bollinger Band. This is still bullish.
The 100 day moving average is still moving above the Lower Bollinger Band. This is bullish.
All major moving averages are climbing which is bullish.
The S&P chart is more bullish than bearish for Wednesday although the closing candlestick is of concern.
There are 7 up signal since January and no down signal in the chart.
Stock Market Outlook: Technical Indicators Review:
Momentum: Momentum is falling and still positive.
- Settings: For momentum I use a 10 period when studying market direction.
MACD Histogram: MACD (Moving Averages Convergence / Divergence) lost 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 still positive.
- 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 a down signal in place and is signaling 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 and negative.
- 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 and barely positive.
- 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:
4250 is resistance
4240 is resistance
4225 is resistance
4210 is resistance
4200 is resistance
4190 is resistance
4180 is resistance
4175 is resistance
4150 is resistance
4135 is resistance
4125 is support
4100 is support
4090 is support
4075 is support
4050 is support
4030 is light support
4025 is light support
4000 is support
Stock Market Outlook for Wed May 24 2023
For Wednesday stocks are set to see more weakness. The technical indicators have slipped and none are pointing to a higher day on Wednesday. Instead, they are advising that stocks will continue to move lower and investors should be ready for a lower close.
Potential Economic and Political Market Moving Events
At 2:00 Investors get the latest minutes of the Fed’s May FOMC meeting. This could move markets although it is unlikely to last, up or down.
2:00 Minutes of May FOMC meeting are released