Stock Market Outlook for Wed Nov 1 2023 – All About The Fed

Prior Trading Day Summary

On Tuesday stocks spent the early part of the day with some losses while investors decided whether to push stocks higher or wait until Wednesday’s Fed interest rate announcement. As the day wore on investors decided to buy and they pushed the SPX up 27 points to end the day at 4193. In the past two days investors have recovered 76 points of last week’s 106 point loss but for the month of October, it was the third straight monthly loss.

The NASDAQ climbed 61 points, closing at 12,851.

Trading volumes were good with 4.3 billion shares traded on the S&P, 69% of which was to the upside. 66% of all stocks were moving higher.

The NASDAQ saw 4.4 billion shares traded with 65% of the volume to the upside and 57% of all stocks advancing.

The question now is whether the Fed sinks the rally on Wednesday afternoon.

Let’s review the closing technical indicators from Tue Oct 31 2023 to see what to expect for Wed Nov 1 2023.

Stock Market Outlook: SPX Closing Chart For Tue Oct 31 2023

The index closed below all major moving averages which is bearish. The closing candlestick ended the day above the Lower Bollinger Band for a second day, which indicates a bounce is underway that could last into Wednesday’s Fed announcement.

The closing candlestick shows the index as oversold with a bullish bounce underway but highly suspect with a on shadow at the top.

The 21, 50, 100 and 200 day moving averages are all falling which is bearish. The 21 day moving average is at the 200 day and may fall below it on Wednesday.

The Lower Bollinger Band is turning lower which is bearish and could signal more downside to come. The Upper Bollinger Band is turning sideways which often indicates another move may be coming soon.

The S&P chart is quite bearish but now shows the bounce as still having room to run higher.

Stock Market Outlook review of Tue Oct 31 2023

Stock Market Outlook: Technical Indicators Review

Stock Market Outlook for Wed Nov 1 2023 

On Monday investors enter the month of November. This month is well-known for its many rallies and indeed hisoically, November is probably the best month of the year for equities.

At present the bounce could stretch into Wednesday ahead of the Fed’s interest rate decision.

Of concern is the 21 day falling to the 200 day and ready to move below it which is another down signal. As well the Upper Bollinger Band is turning sideways which often indicates another directional move is coming soon.  Whether it is up or down is unknown at present but we will get some signals shortly which will provide a clearer signal.

For Wednesday, the Fed will have the final say on market direction and action, at least for the day. I don’t think though, another quarter point increase will adversely affect stocks at present.

Potential Economic and Political Market Moving Events

Today investors get the Fed’s latest decision on interest rates and Fed Chair Powell’s news conference.  On Friday investors get to hear the October non-farm payroll numbers. This will be a busy and volatile week.

Monday:

There are no economic reports

Tuesday:

8:15 ADP unemployment report

9:45 S&P manufacturing

9:45 Chicago Business Barometer is expected at 45.3 up from 44.1

10:00 Consumer confidence is expected at 100.0 versus 103.0

Wednesday:

1:00 Automatic Data Processing Stock (ADP)

9:45 S&P manufacturing i index.

10:00 Job openings

10:00 ISM manufacturing

10:00 Job opening

10:00 ISM manufacturing

10:00 Construction spending